SELF

STORAGE

Places that Work

Delivering productive workspace and
homes in London’s new neighbourhoods

Places that Work ELECTRIC

CAR
REPAIR
SHOP

HOUSING
ASSOCIATION
Delivering productive
DEVELOPMENT workspace and homes
in London’s new neighbourhoods

AR & VR
STUDIO &
TEST LAB

MEDICAL
PROSTHETICS SHARED
3D PRINT & SURFACE
REPAIR SHOP & ACCESS
SOCIAL
ENTERPRISE
CLEANING
COMPANY

LANGUAGE
SCHOOL

YARD FOR GREEN

RIGID LORRY ROOF
& PALLET BUILD TO RENT
TRUCKS HOUSING

NEON
SIGNMAKERS
WORKSHOP &
SHOWROOM
FUTURE
CROSSRAIL 2
TRANSPORT
NODE
CLOSED LOOP
TEXTILE LAB &
PRODUCTION
PARCEL FACILITY
DEPOT
KITCHEN
FABRICATOR &
INSTALLER COMMERCIAL
DRY CLEANER

SHOE
MANUFACTURER
KALE CRISP
MANUFACTURER

METAL WINDOW
MANUFACTURER

INSTANT 3D
PRINTED
MACHINE DARK
REPAIR KITCHENS
COMPONENTS

LOCAL FOOD
START UP
INCUBATOR

DAN
HILL 00
BUTTON
WHOLESALER
Authors
Joost Beunderman, 00
Alice Fung, 00
Dan Hill, Dan Hill
Martyn Saunders, GVA

With contributions from

Richard Brown, Centre for London - Contributor & Editor
Dominic Papa, S333 Architecture + Urbanism Ltd - Development of New London Mix scheme examples

July 2018

DISCLAIMER
The development appraisal advice offered in this Report does not constitute a valuation, and cannot be
regarded, or relied upon as a valuation. It does provide a guide for feasibility in line with the purpose for which
the assessment is required and should not be used for any other purpose than that set out in this Report. This
advice is exempt from the current RICS Valuation Standards (the Red Book).

All rights reserved for commercial use

CC Creative Commons Licence for non-commercial use : Attribution-NonCommercial-NoDerivs 4.0
CC BY-NC-ND For more information : www.creativecommons.org/licences/
CONTENTS

EXECUTIVE SUMMARY 6

1. INTRODUCTION 8
The focus of this report 12

The benefits of a new approach 13

Our research 14

2. THE CHANGING CONTEXT 16

A missed opportunity 18

A debate whose time has come 18

The emerging response 19

The fundamental shifts 21

3. THE SCALE OF THE OPPORTUNITY 26

Sources of future need 29

4. CROSSING THE VIABILITY THRESHOLD 30

5. THE REMAINING BARRIERS TO SCALING UP 36

6. FIVE PROPOSITIONS FOR CHANGE 44

London Commercial Space Co-Investment Fund 46

Local Economic Growth Companies 48

Bolstering delivery through effective planning 52

Develop 5 trailblazing projects over the next 5 years 60

Capacity building 64

7. CONCLUSIONS 66

GLOSSARY 69

REFERENCES 70

ACKNOWLEDGEMENTS 72

PLACES THAT WORK 3

Goodwin & Goodwin Signs, Wood Green
PLACES THAT WORK 4
PLACES THAT WORK 5
 Executive Summary
GLOSSARY
‘New London Mix’ - is our term to
describe the close co-location of
light industrial, distribution and
productive workspace with homes
in a way that works for occupiers
and residents.
6
Against a backdrop of global economic and technological change,
London needs to accommodate a growing population and foster a
more inclusive, innovative and resilient economy. But the capital’s
diverse portfolio of flexible commercial, light industrial, retail, lower
value office, creative and hybrid workshop space is being eroded by
redevelopment, both for housing and large scale industrial buildings
while demand for such space is growing.
Draft New London Plan policy has stepped up protection for industrial
land and proposes a sharper focus on mixed-use as a way of
accommodating both commercial and residential needs. But much new
mixed-use development provides a ground floor occupied by generic
convenience stores, coffee shops or is never fitted out and is eventually
flipped to poorly designed residential.
There will always be industrial activities that should not be mixed with
housing and will need land that is protected from co-location. But
mixing flexible commercial and light-industrial spaces within residential-
led developments can work well in other industrial areas, high streets
and high roads, town centres, and other regeneration schemes. We call
this way of developing the ‘New London Mix’, and call for it to become
a crucial pillar for London’s growth policy, alongside retaining and
intensifying protected industrial land.
Places That Work also demonstrates that there are many areas in
London where such a mixed approach is viable now or could be
viable with relatively modest changes in market conditions or funding
availability. And this is not a niche opportunity. We estimate demand
from an expanding urban service sector and from displaced businesses
to exceed four million square metres – equivalent to all employment
space in the Upper Lea Valley and Old Kent Road combined. And there
is a growing and serious interest across the private, public and housing
association sectors in taking the next steps required to move from the
one or two exceptional examples that already exist to making them
mainstream.
 However, there are some persistent institutional barriers across London
that prevent such solutions from progressing. To overcome these, new
approaches and tools are needed – not just in policy terms but in
the funding and institutions required to deal with widespread market
failure. The scale of change is significant, but there is precedent: from
small beginnings, housing associations now house more than one in ten
Londoners, and are major players in growing the city.

Places that Work recommends:

Establishing a significant London-wide Commercial Space

1 Investment Fund that accelerates and supports the provision of

new forms of mixed residential and productive employment and
industrial development.

Establishing area-based Local Economic Growth Companies to

2 purchase, hold and manage new commercial space from an early

stage in the development cycle with a focus in Opportunity Areas
where there is potential for the New London Mix at scale.

Developing enhanced and updated planning policies, area

frameworks and development management approaches and good

3 practice guidance at both a regional and local level to support

effective delivery of mixed productive employment and residential
schemes.

Delivering five trailblazing projects by 2022 that demonstrate

4 a range of conditions, typologies and delivery routes, exploring

social impact and diverse investment opportunities supported by a
longitudinal research programme.

Supporting wider and deeper understanding of the agenda set

5 out in Places That Work and other associated projects through

conferences, publications, design competitions, exhibitions, training
and other channels.

GLOSSARY Places that Work sets out the scale of the challenge and
‘Opportunity areas’ - are opportunity London faces, and calls for a new approach to
London’s principal opportunities
for accommodating large scale delivering New London Mix as the next generation of mixed use
development to provide substantial development in London’s key areas of change.
numbers of new employment and
housing, each typically more than
5,000 jobs and/or 2,500 homes, with
a mixed and intensive use of land
and assisted by good public transport
accessibility.
PLACES THAT WORK 7
 INTRODUCTION

[ URBAN CONDITION #1 ]
Urban block adjacent to railway infrastructure

Office / low cost studio

space in existing building

Pitta Bread
Manufacturer
supplying regional
restaurants

Residential

Residential

Rooftop amenity

Secondary
Street

Closed loop textile lab, offices

& production / manufacturing
facility
Car Body Specialist

Dried Fruit Wholesaler

Yard suited to Rigid Lorry Railway Arches

/ HGV / Pallet Trucks
vehicular access

Imagine a neighbourhood next to a railway or other large scale infrastructure. A yard

along the railway gives access to HGVs and other vehicles servicing a range of larger
manufacturing or distribution units, whose offices or showrooms front a street. The
housing above have large courtyards on top of the industrial unit. The surrounding
streets have a mix of buildings types, old and new - some existing buildings offering
affordable studios, whereas others are a mix of residential and active ground floor
uses. An industrial estate protected as SIL or LSIS is located at the rear.

8 PLACES THAT WORK

EXECUTIVE SUMMARY

1
Introduction
The Mayor’s vision of ‘good growth’ is set out in the draft New London
Plan and draft Mayor’s Economic Development Strategy. It recognises
that London needs to grow in a different way from how it has done in
the past. In an attempt to solve one crisis – that of housing affordability
– we have potentially created another for workspace. Over the past
decade we have built tens of thousands of new homes in circumstances
of tight land supply and there has been a growth in land-hungry logistics
and utilities activities. This has led to the loss of significant amounts of
[1]
smaller scale and often low-cost commercial space.

The draft New London Plan suggests additional protection for Strategic
Industrial Locations and beefed-up no-net loss policies for Locally
Significant Industrial Sites. Helpful as this is, it still leaves 36 per cent
[2]
of land for small business units, light industrial workshops, last-mile
logistics depots and creatives’ studios unprotected and vulnerable to
housing development. The overall pattern of loss is likely to continue
unless we change our approach.

Debate and emerging policy have focused on three solutions: protecting

GLOSSARY industrial land for activities that cannot be mixed, intensifying industrial
‘Good Growth’ is growth that is and employment space, and mixing a much wider range of employment
socially and economically inclusive
and environmentally sustainable. space with residential and other uses. This report focuses on this third
category.
‘Strategic Industrial Locations’
often known as SIL - are London’s
main reservoirs of industrial,
logistics and related capacity for
uses that support the functioning
of London’s economy.

‘Locally Significant Industrial Sites’

- (LSIS) are locations that have
particular local importance for
industrial and related functions
and designated by boroughs.

‘Industrial intensification’ is the

more efficient industrial use of land
through higher plot ratios through
the introductions of mezzanines,
basements, multi-story schemes
and introduction of smaller units.

PLACES THAT WORK 9

 INTRODUCTION

URBAN CREATIVE PRODUCTION UTILITY DISTRIBUTION

SERVICING & STORAGE

Commercial Recording 3D Car Art

Cleaning Studio Printers Repairs Storage

Food Stage/ Prop Furniture Car Final Mile

Preparation Design Restoration Rental Logistics

Event Graphic Shop/ Events Upcycling Parcel

Management Design Display Manufacture Depot

Building Glass Medical Kitchen Food

Services Blower Prosthetics Installation Wholesalers

Specialist Fashion VR Hardware & Building Self

Printing Designer Software Supplies Storage

Illustration 1 : New London Mix example activities

10 PLACES THAT WORK

INTRODUCTION
William Say, Old Kent Road,
source : Mark Brearley
Brook Farm Sausages, Wood Green,
source : 00
John Steele Framing, Wood Green,
source : 00
The New
London Mix
We use the term the ‘New London
[3]
Mix,’ to describe this approach
- mixing activities, co-locating
a wide range of productive
activities in close proximity to
new homes without detriment to
either residents or businesses.
We believe this is a key condition
for solving the twin challenges
of the 21st century metropolis
– providing suitable housing and
places to work right across the
city, thus underpinning a more
inclusive and sustainable model
for urban growth.
The New London Mix can include
a range of activities from light
industry, designer-maker, storage
space or logistics depots, artist
workspace, commercial and
community uses (see page 10).
The emergence of new hybrids,
between production and retail,
between design, prototyping and
marketing, between employment
space and community space,
between co-working and
making space is blurring the
lines between traditional use
classes and building types.
Many of these activities already
happen side by side right across
London’s employment spaces
and industrial areas that we risk
[4]
losing . of each section that illustrates
The New London Mix would
combine such employment
activities with residential and
other everyday uses such as
shops, offices and cafes. Within
one development site, urban
block or neighbourhood, this
could happen in ‘vertical’ mix
(usually, housing stacked on top
of other uses) or horizontal mix
(employment space buildings
next to housing). Much work
has been done to look at the
physical forms this might take -
The GLA, the boroughs, industry
bodies, architects and others
have explored new design and
 [5]
typological possibilities .
They range from relatively
simple combinations, which are
effectively versions of ‘living
over the shop’ to more complex
combinations that include
multiple floors of employment
space, with specific ceiling
heights, servicing or noise
mitigation solutions. They may
involve open or covered yards
or be serviced from the street.
They may range from multiple
smaller maker units of 10 or 15
sq metres to a single unit of
[6]
c.1000sq metres or even more .
The reality is that there are likely
to be many different layouts and
typologies. In order to provide
a flavour of how these projects
might work, we have included a
sketch example at the beginning
the variety of potential forms
that this might take within the
diverse urban context of London.
PLACES THAT WORK 11
CHAPTER
INTRODUCTION
HEADING
Gaunson House, source: The Mill Co. Project
Timber yard, Old Kent Road, source: 00
Gaunson House, source: The Mill Co. Project
GLOSSARY
‘no net loss’ of industrial
floorspace (and operational yard
space capacity) within designated
SIL and LSIS is a policy proposal in
the Draft New London Plan.
12 PLACES THAT WORK
A Delivery Focus
Despite this emerging discussion,
there is only a handful of
good examples that have been
delivered in London. Conversely
there are many examples of so-
called ‘mixed developments’ with
[7]
boarded up ground floors
perhaps the provision of a generic
convenience store. Therefore
the focus of Places that Work is
on understanding the remaining
barriers to delivering the New
London Mix, and exploring the
financial tools, institutional
arrangements and planning
strategies that would overcome
these.
Supporting
and reinforcing
Strategic
Industrial Land
This report explores how the
New London Mix can be provided
, or both in existing industrial areas
- the areas where the new draft
New London Plan might allow
limited land release for mixed
development if no net loss
was achieved - but also on the
edge of town centres, in estate
regeneration or in transport-led
housing growth areas.
We recognise that there will
always be activities in London
that will, because of their scale,
or local environmental impact,
or transport needs, remain
impossible or highly undesirable
to mix in close proximity to
housing. Those activities that
need to stay in London should
continue to be protected by the
Strategic Industrial designation.
This report is not about those
activities, but is addressed
elsewhere (for example, the GLA
has commissioned work looking
the potential for industrial
[8]
intensification) .
 INTRODUCTION

The benefits of a with local communities. This

would make local and London-
new approach wide economies more diverse,
innovative, inclusive and resilient,
Through the New London Mix, as well as fulfilling councils’
we can increase the amount ambitions for business rates
and range of employment space growth.
15 YR
- not just to achieve ‘no net 15 YR
TRADITIONAL F&B
/ EMPTY loss’ of employment
F&B B2 space,
B1c as The New London Mix would also
is currently the stated aim of have benefits for developers,
• Lower quality residential at ground floor current policy, but to achieve ‘net communities and the city
• Commercial challenges to F&B market
• Lower quality residential at ground floor gain’ across London
• Placemaking – and build
opportunities as a whole – by improving
• No active curation of place
• Commercial challenges to the F&B market better places. contributor to the
• Socio-econmic
the vibrancy, sense of safety
neighbourhood
• No active curation of place
• Growth in SME light industrial sector and distinct character of
A growing
• Businessstock of diverse
rates receipt for Local Authority
neighbourhoods; by maintaining
• Active curation
employment space (which, a critical mass for local facilities
as Chapter 3 shows, we and sociable spaces that
think could comprise several make a city liveable, healthy
millions of square metres of and innovative; and through
new employment space) would the environmental benefits of
better support the growth localised supply chains, reduced
5 YR 15 YR
F&B B2 B1c
of a wide range of current commuting, and the potential
and future sectors from low for balanced district energy
to high employment density: systems. As shown through some
• Placemaking opportunities from creative tech to advanced of our case studies, providing
r • Socio-econmic contributor to the
• Placemaking opportunities
ket neighbourhood
• Socio-econmic contributor to the
digital manufacturing, from food the right kinds of employment
• Growth in SME light industrial sector
neighbourhood production to artist studios
• Business
space need not impact negatively
• Growth inrates receipt
SME light for Local
industrial sector Authority
• Active curation
• Business rates receipt for Local Authority
and design-intensive crafts, on housing delivery aspirations
• Active curation and from social enterprises to and property values; rather it
Illustration 2 : Current approach versus
the potential benefits of applying the New last mile distribution and the can help create good places that
London Mix circular economy of maintenance, support the long-term value of
repair and re-use. Critically the residential market in mixed
it would benefit both start- [9]
neighbourhoods .
up businesses and later stage
growing businesses, supporting
skills and the evolution of a
rich economic ecosystem, and
GLOSSARY enabling effective business
‘business rates’ are a tax on engagement and interaction
business properties set by the
government and collected by local
authorities to contribute towards
the cost of local services

PLACES THAT WORK 13

 INTRODUCTION
Chapter 2
Chapter 3
Chapter 4
Chapter 5
Chapter 6
GLOSSARY
‘LEAP’ - The London Economic
Action Partnership (LEAP) is
the local enterprise partnership
for London. The LEAP brings
entrepreneurs and business
together with the Mayoralty
and London Councils to identify
strategic actions to support and
lead economic growth and job
creation in the capital.
14 PLACES THAT WORK
Our research
Our research is rooted in years of experience of the authors,
contributors, literature review, case studies, and more than 30
interviews with leading experts and practitioners - from the worlds of
residential and workspace development, business occupiers, industrial
space design, real estate finance, housing delivery and employment
space operation.
The report is structured as follows:
• The Changing Context reviews how the debate on employment space
and mixed use has developed in recent years;
• The Scale of the Opportunity looks at the potential for the New
London Mix, in terms of demand and supply;
• Crossing the Viability Threshold considers the commercial reality of
delivering the New London Mix;
• The Remaining Barriers to Scaling Up identifies what is holding this
development model back;
• Our Five Propositions for Change sets out recommendations,
followed by a short conclusion.
Who is it for?
The report is intended for private sector developers and investors,
industrial landowners, commercial operators and studio providers and
public policymakers at local level, within the GLA and LEAP and beyond.
It aims to inform elected representatives and practitioners in planning,
surveying, real estate finance, economic development and design.
Although our research focuses on London, where this issue is currently
most pressing, the lessons and suggestions will also be relevant in other
cities and regions in the UK and abroad, where local authority leaders,
economic development organisations like Local Enterprise Partnerships,
planners and practitioners might already be grappling with these issues,
or are soon likely to be.
INTRODUCTION

Acknowledgements
The research team would like to thank all those who gave their time,
passion and expertise to provide encouragement, challenge and insight
to make this research far better than it would have otherwise been. The
views in this report are nevertheless solely those of the authors, and all
errors and omissions remain our own.

We are grateful to the advisory group members who supported the early
stages and emerging findings:

Alex Jeremy (Poplar HARCA)

Alex Marsh (GLA Regeneration)
Carolyn Cameron (Royal Docks Enterprise Zone Team)
Clare Payne (Royal Docks Enterprise Zone Team)
Dan Bridge (Royal Docks Enterprise Zone Team)
Dominic Papa (S333 Architecture + Urbanism Ltd)
Eleanor Fawcett (Old Oak and Park Royal Development Corporation)
Helen Dias (Ramidus Consulting)
Kitson Keen (Home Group)
Lawrence Barth (Architectural Association)
Louise Duggan (GLA Regeneration)
Maire Grogan (LB Brent)
Michael Delfs (British Land)

We would also like to thank those who shared their knowledge and
feedback throughout the research. The full list is at the back of the
document.

This project has been generously supported by Home Group, Royal Docks
Team and LEAP. Additional thanks are due to GVA for providing in-kind
support throughout the project with expertise and support from across
the company as well as hosting the launch. Without them, this report
would not have been possible. The arguments and analysis contained in
the report are those of the authors and don’t necessarily reflect those
of the funders.

PLACES THAT WORK 15

 THE CHANGING CONTEXT

[ URBAN CONDITION #2 ]
Estate Regeneration

Residential

Rooftop amenity

Local food start

up incubator

Furniture restorer

Shop & events

displays
manufacturer

Working Access
Yard allowing van
access direct to
workspace units

Residential

Computer repair
shop

Picture framer

Local supermarket, High Street

crèche, place of workshop
and cafe mixed with
employment space

Imagine a large urban block that is part of an estate regeneration scheme - with
high density infill or replacement housing forming a perimeter block. The ground
and first floors form an employment ‘plinth’ with a mixture of workspace, social
infrastructure and perhaps a local supermarket or crèche. Servicing happens from
the rear, where a yard accommodates a range of spaces for start-ups, growing
businesses and community use.

16 PLACES THAT WORK PLACES THAT WORK 16

 2
The Changing Context
GLOSSARY
‘permitted development’ allows for
certain types of work to buildings
and changes of use without having
to apply for planning permission.
‘Small and Medium-sized
Enterprises (SMEs)’ includes any
business with fewer than 250
employees
‘affordable workspace’ is defined in
the Draft New London Plan having
rents maintained below the market
rate for that space for a specific
social, cultural or economic
development purpose. Normally
this is provided for specific sectors,
disadvantaged groups or for start-
ups.
106 ha
106
protected ha
industrial land
30% of artists
studios lost by -30%
2019
Illustration 3 : Amount of protected
industrial land and artist studios lost
between 2010-2015 (Source : see footnotes
[10] and [11])
In recent decades, London has been losing industrial and employment
land far faster than planning policy had envisaged, as residential
demand and land values have risen. Between 2010 and 2015 alone,
London has lost 106 hectares of protected industrial land per year
compared to the 37 hectares per year projected in the London Plan, out
[10]
of a total of around 7000 hectares . An estimated 30% of creative /
[11]
artist studio spaces is projected to be lost by 2019 and “permitted
development” has enabled unprotected commercial space to be
[12]
converted into housing often of poor quality .
Reflecting the mounting concern about the impact of losing productive
commercial space on London’s economic health and resilience, the draft
New London Plan calls for a greater focus on protection and provision
of industrial space premises for Small and Medium-sized Enterprises
[13]
(SMEs) and affordable workspace . Most industrial, logistics and
creative businesses that can easily move out of the city have already
done so; the remainder need to be here because of proximity to clients,
[14]
supply chains and talented workers . But many parts of the city are
now reaching a tipping point. Vacancy rates in many employment areas,
such as the Upper Lea Valley, Wandle Valley, Park Royal or Old Kent
Road, are already well below a healthy ‘churn’ rate, and Outer London
areas are seeing increasing demand from businesses crowded out from
[15]
more central parts of London . In addition, many non-industrial
activities are relocating to Strategic Industrial Land – protected through
planning – given its greater security, greater flexibility and often
lower costs. This includes places of worship, artists studios, offices
and the night time economy. It is estimated that 45 per cent of jobs
[16]
accommodated on SIL are now in non-industrial roles .
The combination of dislocation, rent rises, and uncertainty destroys
the rich ecosystem that enables small businesses to thrive, with
local suppliers and collaborators, proximity to clients and designers
and sophisticated networks of talent, ideas and finance. For many
businesses, this is an existential crisis; and arguably the sheer lack
of capacity may already be stifling innovation and growth of new
[17]
businesses .
PLACES THAT WORK 17
 THE CHANGING CONTEXT

A missed heights, flexibility, depth and

AKA Design, Wood Green
source: 00. Furniture makers.
Blue Nile Clothing, Wood Green
source: 00. Clothing manufacturers.
opportunity?
London has a proud history
of successful integration of
workshop and manufacturing
uses with housing: Examples
include in Hatton Garden
(jewellery), Clerkenwell
(breweries, distilleries and
printing) and Whitechapel
(garment manufacture). Post-war
planning emphasised relocating
and segregating ‘dirty’ economic
activities from residential areas
and shopping precincts. The
idea that we can build high-
density residential enclaves,
whose inhabitants commute
to a few metropolitan scale
office and shopping hubs, or
designated ‘industrial’ zones is
still pervasive, despite seeming
unsustainable and outdated.
Zoning also stifles growth by
not aligning with how we know
innovation districts and vibrant
[18]
urban places actually work
access/servicing, affordability,
level of initial fit-out, flexible
approaches to rental terms
and track records, and early
engagement with operators and
occupiers. The phenomenon of
newly built ground floor units
remaining boarded up for several
years is all-too-common across
London.
Much of the future housing
supply in London will come
from existing ‘brownfield’ sites
in zones 3 and beyond. Even in
places where mixed-use projects
are happening, there is often a
lack of diversity of suitable and
flexible workspace hardwired
in from the outset. If carefully
designed and suitable access,
a wide range of activities can
take place in similar spaces.
The risk is that the opportunity
to underpin a diverse economy
through the DNA of London’s new
neighbourhoods is being missed if
. this pattern continues.

The overwhelming relative value

of housing provides developers
‘‘It is estimated with very strong incentives to
that 45% of jobs both speculate on industrial
premises and then minimise any
taking place on non-residential space reprovision.
A debate whose
time has come
Previous studies explored the
concept of mixing industrial and

SIL are now in Many new developments provide

non-residential ground floors
non-industrial only when required by planners -
roles.’’ and not enough attention is paid
to the fundamentals that make
space suitable for a diversity of
businesses. These include ceiling
residential development with
reference to some pioneering
early experiments: The Warwick
Road Depot, Buiksloterham in
Amsterdam and the King Spadina
[19]
Quarter in Toronto .

18 PLACES THAT WORK

THE CHANGING CONTEXT
[ CASE STUDY ]
Travis Perkins &
UNITE student
housing, Kings
Cross
source : Cooley Architects
As owner occupiers of their 1.25acre
site in Kings Cross, building merchant
Travis Perkins spotted an opportunity to
improve their customer experience and
generate additional capital receipt. The
site was redeveloped to include student
accommodation with Travis Perkins taking
a very long lease on the new commercial
space provided at ground floor. The
company is now exploring whether a similar
approach could be replicated elsewhere.
The number of London based
projects in this category is still
limited but growing. The oft-
cited student housing block
above Kings Cross’ Travis Perkins
builders’ merchants (see image),
the artist studios integrated
in a high quality mixed tenure
new housing scheme in Royal
Docks (see page 62-63), the
light industrial studios in Caxton
Works, Canning Town (see page
34), and Devons Road in Bow
(see page 20) all show aspects
of what might be possible, as
well as highlighting valuable
lessons regarding specific market
conditions and delivery routes.
That said, despite significant
investment interest in new
industrial buildings in general,
there has been relatively little
innovation in terms of typologies
or delivery approaches. Large
floor plate distribution units
command a ‘premium’ rent at one
end of the scale, and residential
schemes offer limited mixed
use at the other. Both tend to
come forward at the expense
of smaller, more diverse forms
of workspace, even despite the
growing demand. While such
new ways of mixing productive
activities with residents have not
yet become the norm, what was
previously a niche proposition
is now moving closer to the
mainstream.
The emerging
response
Against this backdrop of market
failure, the Greater London
Authority and London Boroughs
across London are seeking to
promote mixed use approaches
in planning and regeneration
policies. Both the London Legacy
Development Corporation and
the GLA and Boroughs have
commissioned studies on how
mixed use can generate good
places both for living and
working
[20]
.
We have also seen an increase in
direct public sector involvement
in employment space provision
[21]
. But fiscal constraint
means existing resources are
spread thinly, and at times
interventions could have a greater
collective impact. Where new
workspace is delivered, there
is an overwhelming focus on
creative studios or co-working
for start-ups, potentially ignoring
other important sectors. The
New London Mix has yet to
become mainstream, but some
fundamental shifts are pushing it
in that direction.
PLACES THAT WORK 19
 THE CHANGING CONTEXT

[ CASE STUDY ]
Devons Road, Bow Enterprise Park
The original Bow Enterprise Park consisted of c.7,000sq metres of dated
industrial space. Owned and operated by the Workspace Group it no
longer provided a suitable offer to businesses and had become largely
vacant or under-utilised, offering few employment opportunities or
services for the local area.

Alongside Poplar HARCA and Leaside Regeneration, Workspace Group

promoted a mixed-use development proposition for the site over four
phases. This included delivering c.6220sq metres of commercial space,
a third of which is replacement B1c (light industrial) floor space at the
ground floor of residential buildings.

Bow Enterprise Park Peabody purchased the land and has developed the first three phases,
Source : Photography by Robert Greshoff for
Peabody delivering 384 homes (46% of which are affordable) and eight B1c units,
which are let and managed by Workspace Group. With their own secure
access, the light industrial spaces have proved popular, attracting a
range of business activities including a design agency and 3D print studio
as well as providing local jobs and employment opportunities for the
local area.

The scheme has been widely recognised and has been a finalist for
seven awards, as well as being one of Savills’ best performing schemes
of 2017 for residential sales.

Bow Enterprise Park

Source : Photography by Robert Greshoff for
Peabody

20 PLACES THAT WORK

THE CHANGING CONTEXT

10
fundamental
shifts
Traditionally, a series of barriers to
mixing commercial and residential
space have been identified
- such as value and lease
differentials between residential
and employment uses; the risk
aversion in the development
industry; the reluctance of
residents to ‘live above the
shop’; the mortgage industry’s
reluctance to lend money on such
schemes; lack of skills amongst
planners and designers; the lack
of success of ground floor units
where these have been provided.
Many factors undoubtedly still
apply (and are explored in Chapter
5); but many of the fundamental
drivers are now changing.
1. Industry is no longer declining
The decline in activities needing
industrial floorspace has been
stemmed: those activities that do
not require a base within London
have long gone, leaving behind
a high value core of businesses
which are reliant on their location
[22]
within London . Vacancy rates
have fallen to below healthy
levels.
2. Re-appreciating local
economies and supply chains
There is a growing understanding
that many of London’s
employment areas are teeming
with dynamic, innovative new
SMEs alongside established
companies with deep roots in
[23]
their local area , and often
offering relatively well-paying jobs
[24]
to local people . Ongoing local
authority cuts and the devolution
of business rates has focused
minds in Town Halls right across
London.

Vacancy rate Asking rent per SQ FT

7% £13

6% £12

5% £11

4% £10

3% £9

2% £8

1% £7
2009 2017 2009 2017

Illustration 4 : Vacancy rates and rental prices of industrial space 2009 - 2017
Source : CoStar

PLACES THAT WORK 21

 THE CHANGING CONTEXT
3. Servicing the city
Businesses that are vital to
the city’s functioning or its
inhabitants’ needs – whether food
preparation, highly specialised
furniture restoration, parcel
delivery, store replenishment
or waste management – have
to be located within London’s
boundary if the city is to thrive
sustainably. Losing these spaces
has unintended consequences: the
[25]
‘London Made’ film produced
for the Seoul Design Biennale
shows how world-class cultural
institutions like the Barbican
depend on fine-grain supply
chains across London’s industrial
and employment estates. And
logistics company DPD recently
showed how the loss of their Kings
Cross depot meant they could no
longer service the eastern part of
central London with locally based,
low pollution electric vans, but
make deliveries from much further
afield meaning longer journey
times and reverting to diesel vans
with the knock-on impact on air
[26]
quality .  And the more housing
we deliver the more important this
integrated urban servicing space
within London will become.
22 PLACES THAT WORK
4. Technology drives new growth
and consumer trends
The use of technology is allowing
London-based manufacturers to
remain competitive as product
development and innovation
become cheaper. For example,
immersive virtual reality
technology alongside computer
aided design has reduced the
cost of product development;
additive manufacturing (3D
printing) has reduced the cost
and increased the speed of
prototyping. The future promises
more such opportunities from
technological developments such
as distributed digital and ‘on-
demand’ manufacturing, high
value craft, instant repair and
other circular economy activities
[27]
. Technology is complementing
increasing consumer demand for
the bespoke, on-demand, green,
fresh, healthy, local and authentic.
5. Cross-over activities, hybrid
workspaces
The design, prototyping,
production and marketing of both
goods and services are now taking
place in ever more rapid cycles of
iteration, often close to the target
market. Artisanal workshops,
digital start-ups or fast-growing
SMEs need physical production as
well as ‘office space’. Such new
activities require a new breed
of hybrid workspaces that sit
awkwardly between traditional
use classes - a growing demand
not fulfilled by the growth in
[28]
co-working space . There
is a growing recognition that
the current iteration of the Use
Classes Order could be updated to
better reflect this reality.
THE CHANGING CONTEXT
6. Centralisation vs. dispersal of
activity
Whilst growth in the core is
attracting more office activity,
technology is also liberating
entrepreneurs to work right
across the city. We are seeing a
high number of micro enterprises
across London, many of them
innovative ventures run by
second-career professionals who
choose to work close to home.
For example, the development
of small studios, micro-offices
and workshop-retail units at Blue
House Yard in Wood Green has
revealed latent demand - from
internet sale-driven designer-
makers in fashion or homeware
accessories, event and festival
planners, electronic music PR
businesses and graphic designers
[29]
to name just a few . units, especially where these
Blue House Yard, Wood Green (Meanwhile
Space & Jan Kattein)
The development of small studios, micro-
offices and workshop-retail units at Blue
House Yard in Wood Green has revealed a
demand that few people knew existed in the
local area - by internet sale-driven designer-
makers in fashion or homeware accessories,
event and festival planners, electronic music
PR businesses and graphic designers just to
name a few. [21]
7. The slack is gone 8. Innovative districts, vibrant
The combination of these trends places
means that simply put, the slack As our understanding of the
is gone: large scale, higher value innovation economy grows, there
distribution activities need more is a growing appreciation that
space; Strategic Industrial Land is creative and entrepreneurial
filling up with industrial and non- ecosystems are connected to
industrial activities; and a range place - via human networks
of energetic and innovative hybrid and because in higher value,
production activities is looking innovation-driven activities, quality
to grow. In Boroughs such as of place is increasingly understood
Haringey, sites are filling up with to be a driver of talent attraction
[31]
a range of creative enterprises and innovative potential .
which are forced out of more
central areas like Hackney, whilst
still accommodating traditional
clothing manufacturers connected
to the West End, alongside vibrant
and growing local businesses.
As a result, rents have increased
not just for larger premium units,
but also for smaller flexible
are threatened by Permitted
[30]
Development .
PLACES THAT WORK 23
 THE CHANGING CONTEXT
9. Traditional ‘commercial’ space
under pressure
We are seeing a growing crisis
in retail and ‘casual dining’, the
uses traditionally included in
active ground floors of residential
development. This threatens not
just thousands of jobs, but also
town centres vitality. In some
locations, the value differential
between employment and retail
space is closing so it may be
equally attractive to provide
workspace as it is to include
retail. There are also signs that
the market for co-working spaces
might be reaching a moment of
oversupply, even though larger
co-working / serviced office firms
[32]
are still expanding . In many
areas where large-scale office
development won’t work, the New
London Mix could be an important
driver of local job growth and
vibrancy, in order to avoid single
use residential development with
little animation and few local jobs.
GLOSSARY
‘Build to rent’ schemes are larger
scale projects specifically designed
for renters with self-contained
units and typically on-site
management.
24 PLACES THAT WORK
10. Long-term players
Institutional shifts in the housing
market mean there are now
more players with longer time
horizon and incentives. Housing
Associations are aiming to build
tens of thousands new homes
over the next decade, most of
them for rent or shared ownership,
and there has also been a rapid
growth in the institutionally-
[33]
funded “build to rent” . New
players such as pension funds
have a clear interest in the
long-term vitality of their rental
properties; and they recognise that
the success of ground floor uses
can increase value and resilience
of the housing above.
As a result of these changes, the
range, nature and location of
economic activity, and potential
workspace demand and supply
has fundamentally changed.
These shifts have driven a
diversification in the types of
workspace that could be co-
located with residential in London.
Our understanding of what works
in terms of policy, typologies and
delivery has become increasingly
sophisticated over the past
decade. Developing the New
London Mix will enable this to
be applied not only in protected
industrial areas, but also in and
around our town centres, high
streets and new or regenerated
neighbourhoods, to create a ‘net
gain’ of truly additional diverse
employment space capacity. The
next chapter will consider the
potential scale of this opportunity.
 THE CHANGING CONTEXT

[ CASE STUDY ]
Developing hybrid supply chains
for Fashion in London

London’s ‘rag-trade’ heritage of fashion manufacturing which can be

traced back to the early Victorian period is now a high tech and highly
skilled sector. The need to respond rapidly to emerging trends, and for
designers to understand the making process, means that this industry
benefits from being in London. However, it is facing serious challenges –
principally around declining availability and increasing cost of premises
as well as availability of relevant technical skills. These challenges are
restricting the growth of the industry and threatening the future of the
sector in the city.

A consortium of councils, education institutions and a housing

associations is seeking to secure spaces for each segment of the
‘fashion pipeline’ and the entrepreneur journey. This aims to create an
ecology of spaces for start-up and scale-up makers and designers.
Several projects are underway with a focus on the Lea Valley with a
mixture of Good Growth and private funding.
source : Fashioning Poplar

PLACES THAT WORK 25

 THE SCALE
CHANGING
OF THE
CONTEXT
OPPORTUNITY

[ URBAN CONDTION #3]

New development along a high road

Print and
publishing factory

Instant 3D printed
components for
machinery repair in
lab space

Rooftop amenity

Residential Units
above

Neighbouring
Strategic
Industrial Land

Graphic
Designer on
upper floor Pedestrian
access to
courtyard for
residential
units
Kale Crisp
manufacturer
HGV accessible
yard

Goods delivery of textiles High Road

for furniture workshop in
shared yard

Metal tray
manufacturer

Imagine a mixed use block on a major London high road - the ground floor units
fronting the street accommodate a mix of production and service activities
alongside specialist retail and the occasional cafe; a gate provides pedestrian
access to a shared yard which leads to residential entrances as well as servicing a
series of larger employment space units fit for a wide range of production-based
businesses. Vans and trucks enter the yard from a side street; residential amenity
space is provided on the roofs of employment space. An industrial estate protected
as SIL or LSIS is located at the rear.

26 PLACES THAT WORK

 3
The Scale of the Opportunity
The previous chapter described how economic restructuring and change
have created demand for new types of hybrid space – the New London
Mix. This chapter aims to quantify the potential new demand and
[34]
supply . Understanding the scale of the opportunity will help us to
understand the scale of the shift required and what this might mean
institutionally and financially.

PLACES THAT WORK 27

 THE SCALE OF THE OPPORTUNITY

15,000,000 sqm * 3,500,000 sqm

Existing Industrial Opportunity Space
Floorspace in London is 20% of existing
industrial floorpsace

Scale of Opportunity
O2 x 44

O2 x 44

O2 x 44

=
The Shard x 47
Scale of Opportunity
The Shard x 47

The Shard x 47

Scale of Opportunity Royal Albert Hall x 186

Royal Albert Hall x 186

Royal Albert Hall x 186

Illustration 5 : The scale of potential commercial space within the New London Mix

28 PLACES THAT WORK

THE SCALE OF THE OPPORTUNITY
Sources of
future need
Given the dynamics of supply and
demand, population growth and
London’s spatial policy already
discussed, we believe that the
impetus for the New London
Mix is likely to come from three
Stiletto x QRI, Wood Green principal sources:
source: 00
1
Demand from the
expanding urban servicing
sector, meeting the
demands of a growing population,
and comprising activities such
as small batch producers, food
preparation, urban logistics,
commercial cleaners, printers
(as discussed in the previous
chapter).
2
Demand from displaced
businesses, including
Faith Carlton, Wood Green from pressure on
source: 00
existing LSIS/undesignated
employment sites which, even
under tighter New London Plan
policies, will require innovative
new approaches to both retain
the existing capacity and assist in
...within meeting future housing needs.
designated sites
3
Supply-led
almost 20% of opportunities, through
land is used for London’s Opportunity
Areas, strategic infrastructure
non-industrial corridors, town centres and
purposes Housing Zones integrating
the New London Mix into new
neighbourhoods.
It is important to recognise these
are not discrete sources of need
and opportunity, and there will
be overlaps between them.
On the demand side, we estimate
that the combination of new
demand and demand from
displaced activities could be for
well over four million square
metres. This is the equivalent to
all of the existing employment
floorspace in Upper Lea
Valley and the Old Kent Road
[35]
combined .
On the supply side, we estimate
that in London’s key areas of
change as described above there
is potential to deliver 3.2 million
sq metres of commercial space
within the New London Mix.
This is the equivalent of 12% of
London’s current industrial land,
or 20% of the estimated existing
comparable floorspace.
These figures are indicative but
provide a starting point. The
opportunity is clearly substantial
and requires equally ambitious
investment and intervention to be
realised.
PLACES THAT WORK 29
 CROSSING THE VIABILITY THRESHOLD

[ URBAN CONDITION #4 ]
High Density Development near Transport Node

Vehicular
Metal window access for
manufacturer larger vehicles

Strategic
Industrial
Area

Garment
manufacturer

P Parking

Rooftop amenity

Last mile
Art storage logistics depot

Studio workspaces at
Pitta bread upper floors
manufacturer

Residential

Imagine an area where new or improved transport links create an impetus for high
density residential development. A large development site borders on both existing
housing and protected industrial land. A range of taller and lower residential blocks
offer employment spaces on ground and first floor: larger (light) manufacturing
and logistics units near the protected industrial land, and towards the existing
residential area a finer grain of studio-workshop space mixed with other town
centre uses. Some housing blocks have ground floor maisonettes, whereas in the
centre of the site, an stand-alone workspace block offers a mix of flexible office
and studio spaces.

30 PLACES THAT WORK

 4
Crossing the Viability Threshold
Given the scale of the opportunity, is it actually viable to deliver this
New London Mix under current market conditions? The integration of
light industrial space, other employment floorspace and residential
[36]
is technically possible , but few projects have been delivered.
Development viability is often cited as one of the principal constraining
factors. In order to test this, the team undertook a number of high-level
residual land value appraisals of a model scheme in different locations
across London. (It should be noted these are high level assessments
based on reasonable assumptions of cost and value. They do not
constitute a valuation and should not be relied upon as such.)

Locations
Until the approach becomes more common, the New London Mix is most
likely to happen in locations where there is sufficient appetite from
both residential developers and (light) industrial space occupiers. Most
light industrial businesses prefer to operate with as few constraints as
possible, meaning that stand-alone or at least single-use environments
are often preferred. But in areas of high demand, employment space
occupiers are more prepared to compromise on what they see as
‘optimal’ space solutions in order to be in the location they need –
making them more willing to consider mixed-use provision.

We considered demand, supply and value dynamics and market strength

around a hypothetical model scheme across London, moving outwards
from generally higher value areas to places where this becomes more
marginal but is still positive, or could be in the near future given current
trends. Based on current market dynamics our focus was on four places,
all in TfL’s Zone 3: the industrial edge of a town centre in South London;
a mixed employment area in a regeneration zone in the Upper Lee Valley;
an industrial location near the North Circular in northwest London, and
an undesignated industrial area in East London. All test locations have
an existing industrial market and therefore, to a greater or lesser degree,
established demand for diverse employment space.

PLACES THAT WORK 31

 CROSSING THE VIABILITY THRESHOLD

NORTH LONDON

0
- +
TODAY

TOMORROW
EAST LONDON

0
WEST LONDON - +
0 TODAY
- +
TODAY TOMORROW

TOMORROW

SOUTH LONDON

0
- +
TODAY

TOMORROW

Illustration 6 : Potential for New London Mix delivery in current and project future market conditions (Source : GVA)

Future Potential
North
Our analysis suggests that
a small increase over the
average industrial rental
levels (c.15% - the equivalent
of c.£2/sq ft) would enable
viability to be broadly
achievable.
This increase is not
unrealistic, nor would it make
development unaffordable as
these rents are already being
achieved for some units in the
area.
South
In this location development
should be deliverable under
current market conditions
given both industrial and
residential values are strong.
In the future we would expect
this to continue.
East West
Neither industrial or This location would support
residential values currently delivery under current market
support this type of conditions and, we expect,
development at this point will continue to do so in the
in time. We expect market future.
conditions to be better
closer in to Central London,
particularly to the western
end of the Royal Docks, where
development may be more
deliverable. However this has
not been tested.

It is likely that in this location

conditions will not support
delivery in the near term.
However it may be a viable
proposition in the medium
term or sooner where
particular interventions can
be made to overcome market
challenges.

32 PLACES THAT WORK

CROSSING THE VIABILITY THRESHOLD
We have not sought to consider
SIL locations, given the model
scheme is best suited to more
mixed locations – however the
site-specific tests all assume
sites are within existing industrial
employment use and therefore
have an existing use value for
industrial activity.
The Model
Scheme
The model New London Mix
building we tested, provides
c.4,000sq metres of light
industrial space, split into three
small units of c. 300-400 sq
metres (suitable for a range of
light manufacturing, production
or servicing activities) below
120 apartments, and a larger
unit of c. 3,000 sq metres (more
akin to a final mile distribution
depot or wholesale unit) with no
development above to the rear.
All employment units are serviced
from an internal covered yard.
A variant of the scheme tested
the potential to introduce a first
floor studio/office component
of c.1,000sq metres. The model
has factored in the additional
build costs associated with
developing industrial activities
and residential development in
close proximity such as noise
abatement.
Viability Findings
What is evident from this analysis
is that while specific site or
local area conditions make
generalisations difficult some
broad themes emerge:
• Central Activities Zone
market factors are more likely
to support the New London Mix,
which helps explain why the
limited examples that do exist
have been delivered in these
locations.
• A geographic ‘tipping point’
tends to exist in and around
Zone 3, after which there is a
weakening of the residential
and industrial market factors
needed to support this type
of development for a range of
reasons.
• There is sufficient alignment in
costs and values to suggest that
over time it could become more
commonplace and does already
work in our ‘West segment’ and
‘South segment’ case study
locations in and around Zone 3.
• In some locations (our ‘North
segment’ example), delivering
the New London Mix would
only be marginally viable under
current market conditions, i.e.
it would not offer significant
returns above the ‘Benchmark
Land Value.’ In other locations
(our ‘East segment’ example),
it is indeed unviable (i.e. does
not achieve a value above the
Benchmark Land Value
[37]
).
Future improvements to market
conditions would help, and
increased housing densities tend
to support viability - but other
interventions may be required to
enable delivery, including public
sector support.
• Such schemes cannot be
over-burdened by ‘planning gain’
requirements. Our analysis is
based on 35 per cent affordable
housing provision, but if this is
increased to 50 per cent, current
market conditions tend not to
support delivery in all locations in
our Zone 3 locations.
• Therefore, if London is serious
about the opportunity to enhance
its employment offer through the
New London Mix, some choices
will need to be made, or the
public sector may need to find
ways to support developments if
they are to deliver more than 35
per cent affordable housing.
PLACES THAT WORK 33
 CROSSING THE VIABILITY THRESHOLD

[ CASE STUDY ]
Caxton Works, Canning Town

Caxton Works at Canning Town in Newham provides over 300 new homes
and over 20,000 sq ft of ground floor B1 employment space on a site
that once included a bakery and an electrical supplies warehouse. The
developer, U+I, in partnership with Galliard Homes has sought to provide
a high quality, genuinely mixed employment environment for incoming
businesses, to support the emergence of a new town centre in the
Lower Lee Valley.

In order to attract businesses to this emerging location, U+I has offered

Caxton Works, Canning Town
source: U + i
space at sub-market rents for around 3 years (enshrined in the s.106)
and takes an active and ongoing role in amalgamating the diverse mix
of occupiers to create both economic and a social value. The low cost
of the units has led to higher demand and lower vacancy rates and can
provide a similar valuation to an equivalent higher rent. Tenants secured
so far include Bamboo Bicycle, who build cutting-edge bikes that are
sustainable and can be completely recycled after many years of use, and
Dessert Manufacturers who’s work will bring the history of baking back
to the site. Discussions are also underway with an architectural practice
and an innovative electrical manufacturer.

The scheme successfully provides a high-quality environment as well

as external public realm. U+I believes that this positive approach to
placemaking is producing a ‘halo effect’, supporting the value of the
residential scheme. But this can only happen with significant and
ongoing senior commitment to make the project work.
Caxton Works, Canning Town
source: U + i

34 PLACES THAT WORK

CROSSING THE VIABILITY THRESHOLD

PLACES THAT WORK 35

 THE REMAINING BARRIERS TO SCALING UP

[ URBAN CONDITION #5 ]
Town centre infill behind high street

Secondary
Street

Residential
maisonette

P Residential &
commercial
parking

Commercial
dry cleaner

Medical
prosthetics 3D
print & repair
workshop Mezzanine Yard Retail/ High Street
office showroom

Imagine a development site on the edge of a town centre, behind a traditional

high road with historic buildings. A new mixed use block has maisonettes under
apartments, wrapping around a car park and with a mix of enterprise spaces to
the rear. These front on a new ‘enterprise mews’; the units could have mezzanines
making them suitable for a range of activities, including light industrial or craft
makers who sell from the premises. A bar might be allowed too. Existing businesses
on the high road, whether retail units, showrooms or car repair, have access to a
yard which is shared with the units on the enterprise mews. 

36 PLACES THAT WORK

 5
The Remaining Barriers to Scaling Up

Given the scale of unmet need, direction of policy travel, and the
fact that New London Mix is now viable in many parts of London, we
explored what was preventing more widespread adoption of this model.
In fact, when asked about the potential for the New London Mix, almost
all of the over 30 interviewees we spoke to agreed that it is a case of
‘when rather than if’. But uncertainties and prejudices remain, amongst
local authorities as well as developers, which are hindering a wider
adoption of the approach. Some respondents cited concerns or a lack of
experience with downside risks (vacancies, impact on residential values,
operational risk and ability to redevelop) and questions about design,
scale, end-user preferences and finance. Key concerns included:

PLACES THAT WORK 37

 THE REMAINING BARRIERS TO SCALING UP

• How could an investment-ready product be delivered?

• Can any potential detrimental pollution, noise, or visual impact

on the housing quality be overcome without adding to build cost
in ways that jeopardise scheme viability?

• Is it possible and desirable to include multiple types of

employment space within a scheme, and if so at what scale to
achieve critical mass and manage complexity?

• Will end-user ability to pay be sufficient to generate

sustainable revenue streams?

Stella Polaris, Wood Green • Even if the initial commercial tenants are ‘good neighbours’,
source: 00. Recording studio.
are there reliable ways of managing the risk that future
commercial activities might become undesirable to residents?

• Will mortgage lenders be ready to lend on such units, and if so

under what conditions?

• Can sufficient flexibility be created in the larger commercial

spaces to meet the needs of a range of businesses over time
– i.e. can it mirror how traditional sheds work in terms of their
adaptability for a range of users? Or does having residential above
restrict adaptability?

• How can a single site accommodate all of the ‘open space

requirements’ of industrial and residential uses without severely
Magnus Long Design Studio, Wood Green limited development quantum and hence value?
source: 00. Design Engineer.

38 PLACES THAT WORK

THE REMAINING BARRIERS TO SCALING UP
Evolving the investment
opportunity
Several of our interviewees drew
parallels with the emergence of
the Build-to-Rent (BtR) sector
over the past decade. BtR is now
major part of the development
landscape in London with over
60,000 homes in development or
[38]
completed . The rapid growth
of the sector has been supported
by a government ‘task force’, a
£1bn debt and equity fund and
a debt guarantee scheme, along
with clearer policies at both
national and regional levels,
which accelerated the market at
the moment when many private
funds were starting to invest.
Equally there is already a
strong investment sector for
industrial space with funds such
as Royal London, CBRE Global
Investors, Aberdeen Standard,
Orchard Street, M&G, Fidelity
complemented by investor-
operator organisations including
SEGRO, ProLogis, Goodman and
First Panattoni.
Both industrial and Build to
Rent investors share common
characteristics: similar
development timescales, a
proactive approach to place,
long-term asset management
to protect/grow value, and the
desire for a long-term revenue
stream rather than quick capital
receipts. Therefore we believe the
New London Mix could become
a tradable asset class and
investment opportunity for both.
But if this mixed sector is to grow
significantly as an investment
opportunity in a similar to the
Build to Rent sector, a similar
degree of public sector support
and a clear policy framework will
be needed.
Moving beyond siloed concepts of
value and siloed practices
The private and public sector
development and investment
industry and the professions
that support them are typically
split by use, with developers,
departments and teams arranged
by housing, or industrial or retail
specialisms and rarely as mixed
use. Therefore the delivery of
successful mixed use schemes
often requires a bespoke mixture
of skills, understanding of value
creation, financing and focus.
For many, delivering major
mixed industrial and residential
schemes would take them out of
their comfort zone.
Much of the built environment
sector is focused on delivering
homes and often perceives
the delivery of mixed use as
unnecessarily complex and risky.
This is particularly the case for
traditional house builders and
other developers /investors who
are often focused on managing
planning risk and shareholder
returns. Many developers seek to
sell completed schemes where
the housing and employment
space would be sold separately,
to different parties with different
investment perspectives. For
many, the current difference in
value between residential and
employment space within a
mixed-use development leads
them to minimise provision
of employment space. Where
planning policies require
commercial floorspace, they
seek to reduce risk through
selling space on to recognised
‘third party’ operators, larger
businesses or chains with strong
covenants.
But given the growing number of
developers and investors with
a long-term interest in their
developments and an increasing
understanding of the case for
place-making through mixed
schemes, the built environment
sector is starting to take a
different and more integrated
approach. There is now a wider
recognition that rather than
being a burden, well considered
enterprise space drives financial
and social value, becoming part
of the shared neighbourhood
infrastructure that supports local
jobs, skills and resilience.
Public sector policies, priorities
and capacity
The cumulative policy
requirements for planning
contributions for affordable
housing, S106/community
infrastructure levy payments to
fund social infrastructure, and
infrastructure funding levies
PLACES THAT WORK 39
 THE REMAINING BARRIERS TO SCALING UP
Stussy, Wood Green
source: 00. Fashion wholesalers.
Jessica Buttons, Wood Green
source: 00. Button wholesalers.
London Calling, Wood Green
source: 00. Print distribution and digital
marketing for arts, leisure and charity
sectors.
40 PLACES THAT WORK
(such as Mayoral CIL) can make
New London Mix propositions
unviable. Other well-meaning
policies have led to a pepper-
potting of smaller unconnected
workspaces which are often
harder to manage and do not
support clustering.
At the same time, funding cuts
to the London local authorities’
planning and development
departments of 55% per person
[39]
over the past eight years
inevitably led to the hollowing
out of experienced teams in many
boroughs. There is a lack of up to
date and widespread expertise
in typologies and design, how
diverse uses and activities can
be mixed; a loss of capacity to
engage early with developers and
occupiers; an impaired ability to
actively manage public sector
assets; a loss of knowledge
about ‘affordable workspace’
and challenges in consistently
drafting and monitoring effective
S106 agreements. As a result,
despite some good practice in
some boroughs, the drive and
expertise to provide a proportion
of carefully considered and
flexible workspace is not
prioritised and opportunities for
innovation in mixed-use are lost.
Councils also own significant
amounts of commercial property,
but again, cuts to resources
and challenges in attracting and
retaining staff mean that the
opportunities for more active
management and for developing
the New London Mix are rarely
taken. With the main focus of
investment being developing new
housing, local authorities are
not exploring the potential for
low cost public sector borrowing
to support the delivery of new
workspace.
The Missing Links
Finally there’s a question of scale:
has
given the relatively small scale
of occupiers and some new-
build projects, can commercial
portfolios attain sufficient scale
to enable institutional investors
to engage?
The development process itself
seems to be a crucial barrier to
delivery at scale. In most new
mixed-use schemes involving
ground-floor retailers or food and
beverage occupiers, developers
will use an agency to market and
negotiate with end occupiers, or
may sell the space to a specialist
company to market and manage.
But the complexity and
multifaceted nature of
employment space, where
different sub-segments have
different management models
(e.g. co-working and artist
studios are distinct from light
industrial space, which is often
let through industrial agents) and
THE REMAINING BARRIERS TO SCALING UP
Royal Albert Wharf, LB Newham
source: Bow Arts
Royal Albert Wharf, LB Newham
source: Rob Harris
[ CASE STUDY ]
Royal Albert Wharf, LB Newham
Situated at the far eastern end of the Royal Docks at Beckton, this
former industrial site has been brought forward by Notting Hill Genesis
Housing Association (NHG) as a phased scheme of mixed tenure homes
and 9,000 sq metres of commercial space at ground floor. This project
demonstrates how the remaining barriers can be overcome in a practical
way.
The local authority – Newham – had insisted on no loss of
floorspace and included terms in the s106 that stipulated that the
developer target creative industries and provide rent free periods in the
event that no occupiers could be found.
Given the scale of this project (their largest commercial project to date)
in a peripheral and untested location, NHG realised that they would need
to take a different approach to the commercial lettings.
Following internal discussions, NHG decided that rather pre-selling the
commercial space to an investor, they would retain, invest and actively
manage it to support early occupation, place making and resident
satisfaction. NHG went out to tender to seek a creative industries
operator who would take a lease on 1,000 sq metres of workspace and
manage a further 2,000 sq metres on their behalf. In 2017 Bow Arts Trust
was selected as its partner.
Since the appointment more than half of the space has been
successfully occupied by artist studios, a café and multi-use
event space (RAW LABS) run by NHG and Bow Arts, a commercial
kitchen occupied by social enterprise Greenwich Community
Development Association, and a Co-Op local supermarket. There
have been a range of events, community drop-ins and strong resident
satisfaction. Residential sales and rental values have been higher than
expected. The approach has meant that future phases - which will triple
the amount of commercial space – have seen stronger demand.
PLACES THAT WORK 41
 THE REMAINING BARRIERS TO SCALING UP

SOAR works in Sheffield by Architecture 00 provides new-build

offices, workshops, business incubator and drop-in workspaces,
artists’ studios and meeting rooms, along with support services
and community facilities.
42 PLACES THAT WORK
THE REMAINING BARRIERS TO SCALING UP
expectations in terms of rent and
lease conditions make delivery
and management hard to navigate
for mainstream residential /
mixed use developers.
In the few instances where such
issues have been overcome [see
Royal Albert Wharf, Caxton Works
and Bernard Works] there was
significant engagement between
all parties to get to workspace
typologies, lease conditions in a
collective delivery process.
Some private companies (such as
Creative Space Management and
the Workspace Group) as well as
charities and social enterprises
(The Trampery, TheMillCo, Bow
Arts Trust), are providing an
‘intermediary’ function between
the main developer and a mix
of end users. But there is a
mismatch between the scale
of the opportunities being
sought by potential investors
(typically in the tens of millions
of pounds in value), and the
ability of existing operators to
work at this scale. Hence we
are seeing a growing number of
interesting individual projects,
but these are often relatively
small scale and focussed on fairly
specific sectors and end users,
rather than the development
of neighbourhood- or wider-
scale approaches proportional
of the opportunity in London’s
regeneration and housing growth
areas.
Cost, Value and Occupier
Affordability
Many businesses in industrial
areas or other flexible
employment buildings are located
in older buildings and benefit
from relatively low rents. Any
new-build space tends to be
more expensive to occupiers
than existing buildings (in
terms of rent, service charge
and business rate). There is an
understandable concern amongst
both developers and occupiers
that the New London Mix would
require additional construction
costs leading to expensive rents,
or lower returns for developers
and investors. Where emerging
planning requirements ask
for ‘affordable’ employment
space, this might further affect
values and viability. The relative
unfamiliarity with New London
Mix buildings, and how they
would change users over time,
might lead to over-specification,
or fear of needing expensive
upgrades later on. Therefore it
will be important to agree space
specifications - particularly
for mechanical and electrical
systems - that are both simple,
effective and adaptable over the
long term. Equally, interviewees
emphasised that the proportion
of costs and values directly
associated with the non-
residential elements (such as
employment space) tends to
be a relatively small part of
the total scheme. Therefore
a relatively low direct return on
the employment space could
be justified if it adds value over
the long term to the development
as a whole: if successful
employment space ultimately
leads to greater success and
value for the housing within a
scheme, the up-front build costs
could be sustained. In some
cases, particularly in places with
more marginal development
values, balancing the build cost
for the employment space with
end user affordability might
only be possible through public
sector support or outcomes-
focused (social) investment.
In summary, there are a number
of remaining structural barriers to
be overcome, if we are to realise
the potential of New London
Mix. If these could be addressed,
we are confident that long-term
investors, from institutional
investors to housing associations
would come on board. In some
cases, public sector loans or
funding, or social investment,
may be required in order to
overcome low values in the short
term or to achieve particular
social or economic development
outcomes.
The next chapter will elaborate
on measures that will help
overcome the barriers and deliver
the support required.
PLACES THAT WORK 43
 FIVE PROPOSITIONS FOR CHANGE

5 EXEMPLAR
PROJECTS BY
2022

4.1

5. TRAILBLAZING
PROJECTS

4. CAPACITY
5.1 5.2 BUILDING

SUPPORT
UNDERSTANDING REAL TIME
ACROSS ENVIRONMENTAL
PROFESSIONAL DATA PILOT
BODIES

3.1 3.3 3. EFFECTIVE

PLANNING

ADOPT
ENHANCE & SUB-REGIONAL
UPDATE 3.2 APPROACH TO
PLANNING EMPLOYMENT
POLICY PLANNING
POLICY 2. LOCAL ECONOMIC
LINKED GOOD GROWTH COMPANIES
PRACTICE
2.1 GUIDANCE

ESTABLISH
AREA BASED
LEGCo’s

1. LONDON
COMMERCIAL SPACE
1.1 INVESTMENT FUND

£50-£100mn
LONDON WIDE
REVOLVING
FUND

Illustration 7 : Five propositions for change ecosystem

44 PLACES THAT WORK

6
Five Propositions for Change
No single development or financing model can address the scale and
urgency of the challenge described in this research - or truly fulfil the
potential of the opportunity to embed employment space into the very
DNA of London’s next generation neighbourhoods. What is needed is a
combined approach to tackling the barriers described in the previous
chapter and encourage large scale private sector engagement backed up
by a supportive public sector policy framework, including planning policy
and co-investment.

We have developed five broad initiatives which taken together would

provide a resilient approach to plan, fund and build thousands of
New London Mix projects. These ‘Big Five’ are ‘platform’ propositions
that have the flexibility to be applied to, and enable, new models of
development across a range of circumstances. The propositions are
mutually reinforcing and so should be implemented as a programme
and a complement to existing initiatives where possible. Programme
leadership should come from within the LEAP and GLA, working with
partners from across the GLA family, local authorities, investors,
developers, housing associations, business improvement districts,
operators, architects, consultants and others.

PLACES THAT WORK 45

 FIVE PROPOSITIONS FOR CHANGE
[ IDEA #1 ]
Establish the London Commercial Space
Co-Investment Fund
Recommendation
1.1 The GLA/LEAP should establish a
c. £100 million+ London-wide revolving fund
that generates co-investment to accelerate and
support the provision of the New London Mix.
• We have seen how investors
remain cautious about
committing to major New London
mix schemes. Overcoming this
institutional inertia is critical to
unlocking the sector’s potential.
Creating a co-investment fund
which works with councils and
the private sector to ‘de-risk’
projects through pioneering
shared investment can support
delivery of first projects that
further test and develop the
proposition, enabling developers
and investors to gain experience
more quickly, while sharing
risk and reward with the public
sector.
• The fund could engage in
a variety of ways, for example
matching private and public
funding as upfront investment,
acting as a ‘backstop’ guarantor
on commercial space returns or
investing public land assets as a
match to private equity.
46 PLACES THAT WORK
• The public funding role should
therefore focus on smoothing the
investment ‘curve’ by balancing
the upfront capital costs with
long term returns. It should
focus on unlocking the first
wave of projects that capable
of demonstrating investment
potential, with repayments
providing an opportunity for
reinvestment over the long term.
• The fund may need to be
‘topped up’ at early stages to
ensure sufficient investment
is available to establish a
sustainable pool of projects.
This fund ‘top up’ could come
from a variety of sources such
[40]
as retained business rates ,
prudential borrowing by local
authorities, investment of
locally controlled public sector
pension fund capital, private
sector matched funds or specific
outcome linked funding (e.g.
affordable housing and housing
zone funding; grant-funding or
social investment in employment
and skills; entrepreneur and
FIVE PROPOSITIONS FOR CHANGE

[ CASE STUDY ] The Mayor of London, together with Arts Council England and Outset,

Creating New have been working up a business plan for a Creative Land Trust (CLT), an
innovative solution to finance affordable creative workspace in London.
Funding Models: This forms part of the Mayor’s Cultural Infrastructure Plan and cultural

The London planning policy to protect and grow space for London’s cultural and
creative industries many of which are under threat or being lost through
Creative Land redevelopment.
Trust Proposal
The CLT will adopt a blended capital model, harnessing the power of
philanthropic funding to catalyse additional investment at scale and at
speed, as well as to lower the cost of capital.

The CLT is likely to use the following three routes to secure creative
workspace:

1 Outright ownership: The

CLT would purchase each
property and then lease it
to studio providers.
The entity is likely to be an
independent charity, overseen
by a Board of Trustees and
supported by a team of property
experts. The trust will fund

2 Joint ownership: The CLT

would provide capital (eq-
uity) that enables a studio
projects on the basis of clear
guiding principles. The team is
currently in discussion with social
provider to access top up
impact investors, operators and a
funding (debt).
number of pilot project partners
across London.

Rivenwood Coppice, Blue House Yard,

Wood Green
3 The CLT receives assets/
properties through
ownership transfers and long
source: 00
leases and then leases them
to studio providers.

start-up business support or affordable space, carbon emissions

reduction) where the investment contributes to these outcomes.
These funding streams could add to the core fund or create specific
investment streams.

• Critically the fund should be set up with a clear exit point and
strategy established to ensure public money is only deployed as and
when, and where, it is most needed. Prolonged visible investment may
act as a deterrent to purely privately financed projects as long-term
public sector support might be seen as sign that a project isn’t viable.

• The scale of fund will be dependent on its scope and geographic

coverage, as well as the particular conditions for each project proposed.
Our hypothetical scheme suggests a base build cost could be in the
region of £15 - £20million (before fees, land acquisition etc.) with the
employment space representing a third of this; as such each project
could require support up to c. £6million if the fund fully covered the
cost of delivering the employment component as a mechanism to ‘de-
risk’ the project.

PLACES THAT WORK 47

 FIVE PROPOSITIONS FOR CHANGE

[ IDEA #2 ]
Establish Local Economic Growth
Companies (LEGCo’s) in areas of change

Recommendation

2.1 The GLA, LEAPs and Local Authorities should work with Housing
Associations, landowners, sector bodies, Business Improvement Districts,
existing workspace providers and operators and others to seed fund and support
the establishment of area-based Local Economic Growth Companies. These would
purchase, hold and manage employment space where there is potential for mixed
employment and residential development at scale.

• Our research has found residents as well as occupiers.

that there is often a missing
link between developers and
occupiers that requires bridging
by a new form of intermediary
institution with sufficient capital,
capacity, business models,
experience and know-how for
institutional investors to engage.
In areas where there is a critical
mass of new development, such
intermediaries would agree to
take up the employment space
in a New London Mix scheme
early in the development process.
They would make sure that
spaces are delivered to the right
specification and conditions, and
let them to diverse end users.
• By careful letting and curating
of activities both within buildings
and the public realm (including
managing service charges), they
could steer economic activity
taking place, thus reassuring and
creating value for developers,
Equally, they might be able to
mix more affordable and more
commercial units in line with
local conditions and policy
priorities, targeting a long-term
yield across their portfolio. We
have called these intermediaries
‘Local Economic Growth
Companies’ (LEGCos).
• We would expect and
encourage LEGCos of all shapes
and sizes to emerge in different
circumstances and parts of the
city, with funding and operating
models depending on local
context and objectives.
• In many areas, they would
be entirely commercial entities
that are self-financing. Market
borrowing should be possible if
long leases are obtained at early
development values in viable
locations.

48 PLACES THAT WORK

FIVE
THE SCALE
PROPOSITIONS
OF THE OPPORTUNITY
FOR CHANGE

IDEA #2 ESTABLISH LOCAL ECONOMIC GROWTH COMPANIES IN AREAS OF CHANGE

• In other cases, they would • In some cases, LEGCos could line with local conditions and
access a mixture of public and be set up as mission-driven policy priorities, possibly cross-
private funding. This might social enterprises or not-for- subsidising them from more
include the London Commercial profits. This would focus them commercial units. This would
Investment Fund described on supporting local regeneration support draft New London Plan
above, (pooled) Section106 funds, in response to the local social Policy E4. Some of this early-
prudential borrowing, business context. For example, they stage business space could be
rate retention, and other public might provide or work together exempt from business rates
funding such as Affordable with others to offer a range of to help grow SME activity
Housing loan finance (where complementary services such that would underpin long-
additional affordable homes are as start-up incubation and term business rates growth.
unlocked by this approach). Social business support, platforms for Accreditation schemes, such as
investors, many of whom have community ventures, training recently proposed in response to
shown an interest in investing and skills development and London’s workspace affordability
in real estate to achieve social other local area initiatives. By crisis, might be developed
outcomes, are likely to play a leveraging mixed funding sources to support such rate relief
[41]
role, as could outcomes-driven rather than relying solely on schemes .
grant-makers and housing real estate income, they could
associations. Where public land become a key part of London’s • In order to achieve the
is being developed, the public Good Growth infrastructure. multiple financial, economic and
sector could recycle its land Like Housing Associations place-making outcomes, ongoing
value back to support such provide affordable housing, they partnership working is critical.
arrangements. might offer affordable units in LEGCos need to be established
early to work with developers
and planning authorities to agree
suitable terms, specification and
design. This enables them to
[ CASE STUDY ] ‘buy in’ to schemes early, when
Camden BID values tend to be lower. LEGCos
are then best placed to leverage
Camden BID exploring opportunities for mixed-use these assets to develop and
development: Over the past 9 years the Business Improvement purchase space in future phases,
District Camden Town Unlimited has transformed 17 as well as establish connections
properties, created 10,000 sq metres of new employment with local businesses and
space and supported the creation of 200 jobs. In order to communities. LEGCos could also
secure further economic benefits, it has created a charitable operate across administrative
trust to work with Camden Council to purchase a site and boundaries, especially where
carry out the development of a mixed-use building that employment areas lie at the
combines affordable employment (co-working) space on the periphery and intersection of
lower floors, with affordable residential (PRS) accommodation borough boundaries.
on the upper floors.

PLACES THAT WORK 49

 FIVE PROPOSITIONS FOR CHANGE

IDEA #2 ESTABLISH LOCAL ECONOMIC GROWTH COMPANIES IN AREAS OF CHANGE

• LEGCos might operate and directly lease space to end occupiers,

providing them with an income to repay any debts incurred, or in some
cases would contract with a specialist operator. Some of these operators
could be sector specific, such as artist studios, tech businesses, fashion
industries, food production, or construction and engineering. Given the
right conditions, many LEGCos will emerge from existing operators. The
GLA should work with operators through the existing workspace providers
group.

Poplar Riverside, source: LB Tower

Hamlets

50 PLACES THAT WORK

FIVE PROPOSITIONS FOR CHANGE
IDEA #2 ESTABLISH LOCAL ECONOMIC GROWTH COMPANIES IN AREAS OF CHANGE
[ CASE STUDY ]
Local Economic Growth Co: Poplar Riverside
Commercial SPV Proposal, LB Tower Hamlets
• Poplar Riverside aims to
deliver a minimum of 10,000
new homes within the eastern
third of Tower Hamlets in the
next 10 years, virtually doubling
the local population. Retaining
employment space is a key
component in the placemaking
vision for the area although in
reality it has proven challenging.
Where provided, ‘shell and core’
employment spaces are then
often left empty or mezzanine
residential allowed (the area is in
a higher flood risk area). This has
a knock-on effect on developer
confidence, sales rates and
values and rental rates, thereby
reducing the ability of schemes to
support affordable housing and
wider infrastructure provision.
• A local housing and
regeneration association – Poplar
HARCA – and its placemaking
team Accents has been actively
promoting a partnership with
the Council, the GLA and private
developers which seeks to deliver
successful mixed employment
space as part of residential-led
schemes.
• The intention is to create a
Special Purpose Vehicle (SPV)
that would both support the
creation of a successful place
through residential delivery
and ‘off-plan’ purchase of
employment space on long
leases with profit-share positions
offered to the developers as
required. The SPV would act
as a repository of employment
space, while promoting the area
as a new business location, and
providing early advice on type
and quality of employment space
to allow for targeted lettings.
• While the SPV would hold the
premises, these will be let out
by third-party operators, who in
turn will be partially responsible
for attracting and retaining
new business as well as the
operation and management of
the employment space. Securing
the scale of commercial space
allows the SPV to provide the full
range of affordability required to
deliver a genuinely broad-based,
accessible creative industry
cluster over several phases.
• The project partners have
agreed in-principle funding for
the early projects that would be
secured against rental income
based on a viable business model.
Accents is currently building
the market through the project
‘Fashioning Poplar’, supported by
the GLA’s Good Growth Fund. The
project includes converting over
100 vacant garages and investing
in the Leaside Business Centre.
Both spaces are currently owned
and run by Poplar HARCA and are
being delivered in partnership
with London College of Fashion
and workspace provider The
Trampery.
• Accents is in active
discussions with developers
in Poplar Riverside to develop
sustainable strategies for
additional temporary and
permanent employment space
across the Lower Lea Valley. The
key lesson – “get in early”!
PLACES THAT WORK 51
CHAPTER
FIVE PROPOSITIONS
HEADING FOR CHANGE

[ IDEA #3 ]
Bolstering delivery through effective
planning
Our research has demonstrated that planners at all levels and across
policy and development management have roles to play in achieving
the New London Mix. Planning sets the basic ‘rules of engagement’ for
development activity and can help to manage the expectations of all the
parties – particularly around land value, development capacity, mix and
tenure. The Draft New London Plan has become much more supportive
of the development of mixed industrial/residential schemes, for example
through policies for ‘no net loss’ of industrial floorspace.

It would, however, be unreasonable to expect these regional policy shifts

alone to be successful in achieving vastly different outcomes across the
city. Even after the New London Plan’s adoption, local planning policy
changes will be required to apply its policies locally, and for specific
sites.

Recommendation

3.1 GLA and local planning authorities should

develop enhanced and updated planning
policies, area frameworks and development
management approaches at both a regional and local
level to support effective delivery of mixed employment
and residential schemes. This is likely to include:

• Ensuring that the New London Mix forms a key element of a future
new or updated London-wide Industrial Supplementary Planning
Guidance. This would include polices on the redevelopment, quantum,
mixing, design and access, fit-out levels, management, viability and
typologies of employment spaces including those co-located with
residential uses. Such an updated SPG should also set out where and
how ‘net gain’ in functional employment space should be developed at
borough level.

• Reviewing and updating other policy areas to enable the New London
Mix. By way of example, in order to overcome siloed ways of working,
any review of the London Housing Design SPG would need to address
the design implications of including new homes in such mixed schemes.

52 PLACES THAT WORK

FIVE PROPOSITIONS FOR CHANGE
IDEA #3 BOLSTERING DELIVERY THROUGH EFFECTIVE PLANNING
• Recognising that viability
for a scheme which re-provides
employment floorspace may well
perform worse than an equivalent
residential-only scheme. This
may be due to lower margins on
employment uses, longer-term
revenue streams, any occupier
decant costs, as well as the
additional costs associated with
building more complex buildings
with multiple uses. Therefore
proposals may not be able to
meet all policy objectives and
remain viable, as was borne out
by our viability test in Chapter 4.
This may mean that planners will
need to be clear on the trade-
offs and work with colleagues
to secure additional funding. For
example, schemes seeking to
provide 50% affordable housing
may require higher levels of
grant, very patient debt, or
perhaps increased density.
• Providing further guidance
on the ‘plan-led’ approach in
draft New London Plan Policy E7
for industrial areas that include
meaningful engagement and
developing a robust evidence
base. Planners and developers
really need to understand the
nature of and relationship
between the businesses and
activities represented in the
area and how relocation could
work. This needs to feed into
every scale of plan-making –
from the wider Opportunity
Area Planning Frameworks to
the more detailed masterplans.
Policies need to resist piecemeal
residential development that
often undermines the long-term
viability of employment areas.
• Revising local plans to identify
new opportunities that should
provide additional capacity for
business activity through New
London Mix schemes. This should
look beyond solely industrial
and employment land to new
locations such as secondary
retail parks, large housing estates
or town centres benefiting from
transport investment.
• Developing effective Section
106 approaches that provide the
clarity and certainty that suitable
spaces, of sufficient scale, will be
delivered and filled with locally
relevant and positive uses. This
could include clauses that require
developers to offer the space
at sub-market rents if it is not
occupied within a certain period.
For example the agreement could
offer the commercial space
the LEGCo (see Idea 2 above)
on preferential terms. Planners
should seek to create clusters of
business activities rather than
dispersing smaller, less viable
productive commercial spaces
across a number of schemes.
PLACES THAT WORK 53
FIVE PROPOSITIONS FOR CHANGE

Redemption Brewery, Northumberland Park

source: 00
FIVE PROPOSITIONS FOR CHANGE
IDEA #3 BOLSTERING DELIVERY THROUGH EFFECTIVE PLANNING
Bernard Works
source: The Bernard Works Project
Workspace and event space in Tottenham,
Haringey Works studios tethered to
affordable live units. (Still to be built)
[ CASE STUDY ]
South Tottenham AAP and Bernard
Works
The South Tottenham Employment Area (STEA), lying between Seven
Sisters and Tottenham Hale, has traditionally been a key focus for
productive activity within Haringey. The business base has diversified
in recent years, attracting a range of creative businesses and new
specialist productive activities alongside more traditional storage,
distribution and processing activities. This growth has led to new
permanent and interim workspaces, such as the curated offer at
Gaunson House and Greenhouse Studio and live-work spaces at
Fountayne Road.
Like many employment locations, South Tottenham has come under
residential development pressure. The Council developed an Area Action
Plan (AAP) to manage this process by identifying areas where a mixed-
use approach would be appropriate, provided schemes retain/enhance
the employment offer. This was underpinned by detailed feasibility
analysis to demonstrate that the approach is deliverable.
Responding to this policy context the Bernard Works scheme (by GCAP
Investments and designed by Duggan Morris Architects) will redevelop
a site within the STEA to provide an integrated scheme containing
99 homes and 2,500 sq metres of light industrial/studio workspace.
It includes 12 ‘tethered’ affordable rented units, which can only be
occupied by business operators signed up to 3-year sub-market leases
on the workspace.
Bernard Works Project Ltd. Has been established by social entrepreneur
Nick Hartwright to manage and operate the workspace and tethered
flats. The company will prioritise lettings to local businesses, meaning
up to 40 Tottenham/Haringey businesses could benefit, creating space
for 225 jobs. The role of Nick’s team’s in both ongoing management
of interim uses of the existing site and in helping to shape the final
proposals has been important in securing planning permission.
PLACES THAT WORK 55
CHAPTER
FIVE PROPOSITIONS
HEADING FOR CHANGE

IDEA #3 BOLSTERING DELIVERY THROUGH EFFECTIVE PLANNING

Recommendation

3.2 The GLA, working with London local

authorities and other stakeholders should
produce policy-linked good practice guidance (similar
to the Mayor’s Estate Regeneration Guidance) that sets
out how New London Mix can be positively provided.
Where redevelopment is involved, the Mayor should
use London-wide planning powers and any funding to
support adherence to the guidance.

The guidance should consolidate • Expecting enhanced levels of

the growing body of research and
policy work undertaken in recent
years to cover the following
topics:
• Understanding how
businesses work both individually
and collectively and who they
employ as part of the brief
definition stage of any project.
• Understanding existing
and future occupier needs in
terms of access, servicing of the
housing element, requirements
for specialist premises, flexibility,
yards, access and public space,
and the scale and specification
of plant and machinery; and pros
and cons of different typologies
such as ‘vertical’ and ‘horizontal’
mix.
engagement (beyond those set
out in statute) from landowners
and applicants from the earliest
stage of any development project
and throughout the project.
This should include meaningful
liaison with existing and incoming
businesses, operators and sector
bodies.
• Preferred approaches to
negotiations and a fair deal for
decanted businesses, including
good practice sharing on Section
106 agreements that support
effective delivery and business
relocation

56 PLACES THAT WORK

FIVE PROPOSITIONS FOR CHANGE

IDEA #3 BOLSTERING DELIVERY THROUGH EFFECTIVE PLANNING

[ CASE STUDY ]
Cedar Way, Camley Street Case Study

Cedar Way is a thriving industrial estate just north of Kings Cross.

Employing over 500 mostly skilled workers in food production,
processing and distribution, industrial laundry, model making and other
sectors, the well-established businesses play an important role in
servicing Central London. As majority freehold owner, Camden Council
is preparing plans to redevelop the area to make better use of the land
and support its regeneration programmes. 

In response to these plans, the Camley Street Sustainability Zone and

the Camley Street Neighbourhood Forum are linked local organisations
Camley Street - Cedar Way (existing)
source: Karakusevic Carson Architects bringing together the interests of the businesses on the industrial estate
and those of residents on the residential estate opposite. 

The Neighbourhood Forum has been developing a neighbourhood plan

for the redevelopment of the industrial estate which would maintain
the existing businesses in new premises, provide working space for
new businesses as well as hundreds of new homes for local people. In
the draft plans drawn up for the Zone and the Forum by the architects
Karakusevic Carson, most of the homes would be for rent: either social
housing or ‘genuinely affordable’, meaning that rents would be pegged

Camley Street - Cedar Way

to a third of the average Camden income.  Some of the homes would be
source: Karakusevic Carson Architects for sale. The plan will be submitted to the Council and form part of the
statutory Development Plan for any future planning application.

PLACES THAT WORK 57

 FIVE PROPOSITIONS FOR CHANGE
IDEA #3 BOLSTERING DELIVERY THROUGH EFFECTIVE PLANNING
Recommendation
3.3 GLA and London local authorities to adopt
sub-regional approach within London to
industrial space planning where feasible.
• There are many cases
where planning across
borough boundaries can offer
the potential for effective
consolidation, expansion and
clustering of industrial and
productive employment activities
in a way that provides for more
and better housing as well as
supporting the ongoing viability
of existing businesses and
enterprise growth.
• Sub-regional approaches to
addressing strategic servicing
needs and the provision of
vital services can unlock land
potential. For example, the
consolidation of local authority
direct service operations,
transport depots and waste
facilities either within or between
boroughs can free up land or
remove bad neighbour issues,
allowing mixed development to
come forward.
58 PLACES THAT WORK
• Cross-boundary economic
planning also allows greater
scope to address sector specific
needs and ensure supply chains
are fully catered for in terms
of their space needs, retaining
the complex inter-relationships
that allow businesses to operate
across London.
• Infrastructure corridors often
provide these strategic linkages,
locating close to stations on lines
that offer access to clients and
supply chains. The Victoria Line
corridor is key example, with a
range of creative, artisanal and
digital businesses along its route
from Brixton to Walthamstow,
benefiting from access to central
London markets and local
networks. Future planning should
recognise these dynamics when
considering the strategy for
infrastructure-linked growth.
FIVE PROPOSITIONS FOR CHANGE

IDEA #3 BOLSTERING DELIVERY THROUGH EFFECTIVE PLANNING

Flux Metals, Old Kent Road

Source : Mark Brearley
PLACES THAT WORK 59
 FIVE PROPOSITIONS FOR CHANGE

[ IDEA #4 ]
Develop 5 Trailblazing Projects over the
Next 5 Years
Other than one or two modest scale or exceptional examples, London
lacks significant New London Mix schemes that demonstrate the ‘proof
of concept’. The development of a number of scaled exemplars in
different contexts across the city would go a long way towards turning
the considerable interest expressed throughout this research into real
projects as well as providing valuable learnings for future schemes.

Recommendation

4.1 The GLA and boroughs should convene

partners to enable five exemplar projects to
be delivered by 2022. Partners could include Homes
England, social investors and the private sector

• There are already a number of • Schemes would be selected

schemes at feasibility or planning
that could be supported through
into delivery. The schemes could
be financed partly by the London
Commercial Space Investment
Fund as well as other sources
of funding set out above, which
potentially includes including
public sector land.
to demonstrate a range of
conditions, typologies and
delivery routes. It is likely that
the projects will be at the scale
of an urban block (say at least
around 2 acres/0.8 hectares) or
neighbourhood in order to provide
the flexibility and accessibility
required. Schemes should
demonstrate an effective mix of
industrial, productive commercial
and last-mile logistics activities
with housing

60 PLACES THAT WORK

FIVE PROPOSITIONS FOR CHANGE

IDEA #4 DEVELOP 5 TRAILBLAZING PROJECTS OVER THE NEXT 5 YEARS

• The five trailblazing projects • For many light industrial

would be supported by a
longitudinal independent research
programme undertaken by a
suitable institution. Project
teams would work with all
tiers of government, agencies
and other partners to better
understand multiple social and
financial impacts, such as getting
people back into work, which is
estimated to cost anywhere from
£3,000 to £15,000 per person.
This information could be used
develop a social impact model
that measures the benefits
delivered and explores how
alternative investment models
could diversify and grow funding
for future projects.
and workshop businesses,
housing costs for employees
are as much of a challenge
as the availability of suitable
commercial spaces. In the
exemplar schemes, developers
and housing associations should
seek to establish ‘tethered’ live-
work programmes where a new
home (probably at intermediate
rent with an Assured Shorthold
Tenancy) is provided to those
working within the employment
space. Further research is needed
to explore different ways this
might work in practice.

• The trailblazing schemes

would also demonstrate how
development projects can
work with existing businesses
and buildings to create a good
employment-led public realm,
support placemaking, and secure
the development site. Rather
than just being a meanwhile
use, the pioneers occupying
space on a temporary basis will
help to de-risk the project and
should be considered long-term
[42]
occupiers .

PLACES THAT WORK 61

 FIVE PROPOSITIONS FOR CHANGE
IDEA #4 DEVELOP 5 TRAILBLAZING PROJECTS OVER THE NEXT 5 YEARS
[ CASE STUDY ]
Royal Docks West, LB Newham
Silver Building, Newham
Workspace and cultural centre, Silvertown,
Newham
source: Silver Building
62 PLACES THAT WORK
The Royal Docks was historically a centre for production, trade and
London’s gateway to the world. It is now an emerging area of change,
where creative start-ups will exist alongside more established firms,
and a balance of affordable and commercial workspace will create a
sustainable and healthy working ecosystem. In short, it is the perfect
place for trailblazing projects to happen.
The Royal Docks Enterprise Zone (EZ) became operational on 1 April 2013
and has the potential to deliver up to 35,000 jobs and 4,000 homes. The
EZ comprises several GLA owned strategic development sites at the
heart of the Royal Docks Opportunity Area. London’s only EZ is designed
to accelerate economic and housing growth and enables new business
rate income within the area to be retained and recycled for a period of
25 years. As major land owner and with the ability to borrow against
future business rates income, the GLA is able to provide up-front
investment to make projects happen that the market, on its own, would
not deliver.
Home to major employers such as Tate and Lyle, City Airport, Excel and
Newham Council, the Royal Docks also includes major employment-
led development projects including the ABP development at on site
Royal Albert Dock (c.470,000 sq metres office plus 850 homes in total),
Silvertown Quays (700,000 sq metres of commercial space and 3,500
homes) and London & Regional’s Albert Island (100,000 sq metres of
shipyard and industrial space).
The GLA and LB Newham together have established a team to bring
forward these major schemes while at the same time diversifying and
strengthening the wider employment offer – often as part of mixed-use
projects.
FIVE PROPOSITIONS FOR CHANGE

Silver Building, Newham

Workspace and cultural centre, Silvertown,
Newham
source: Silver Building

To achieve this, the Royal Docks team has been working with local
stakeholders and its development partners to encourage meaningful
pioneering meanwhile uses to come forward as a way of proving the
opportunity, place-making and building longer term partnerships with
operators. The team has used architectural competitions and the
GLA’s regeneration funds to kick start this process. Projects include:

• At Thameside West, workspace operator The MillCo Project has

leased around 5,000 sq metres of studios and production space. Now
mostly let, this project has demonstrated that there is demand for a
range of creative and light industrial occupiers in this location. The
intention is for MillCo, the GLA and the developers Keystone to work
together to explore options for how best to manage commercial space
in the permanent development.

• At nearby Silvertown Quays, the partners have appointed artist

studio provider V22 to develop a temporary neighbourhood for
affordable workspace, exhibition and community spaces, cafe/bar and
leisure areas, as well as green spaces and gardens.

As explained in Chapter 4, the viability of mixed employment and

residential schemes becomes more challenging the further out one
travels in East London. With around 30,000 sq metres of commercial
space either built or in the immediate pipeline around Royal Victoria
Dock and 60,000 sq metres in ABP’s first phase at Royal Albert
Dock, the Royal Docks Team is working with partners to ensure an
appropriate mix to enable successful projects. This includes working
with the Creative Land Trust (see Case Study on page 47) as well as
direct investment into a range of emerging projects. The intention to
create a more diverse economic ecosystem to evolve (from start-up,
move on, office, very light, and heavier industrial spaces) in the Royal
Docks, and to diversify income streams.

PLACES THAT WORK 63

 FIVE PROPOSITIONS FOR CHANGE

IDEA #5
Capacity Building: Building capacity, skills
and awareness and a suitable evidence
base amongst professionals and operators
Recommendation

5.1 Professional bodies (RICS, RTPI etc.) and

business groups (London First, House Builders
Federation, British Property Federation, G15) as well as
the LEAP and public sector groupings (London Councils)
should support understanding of the agenda set out
in Places That Work and other associated projects
through conferences, publications, design competitions,
exhibitions, training and other channels.

The growing body of evidence and good design practice on this topic
needs to be better disseminated amongst practitioners in the public,
private and financial sector. This includes urban design, architecture,
planning and public realm design, as well as understanding of new
financial models, lease structures, use of covenants and delivery process
and long term management.

A high profile New London Mix design competition, ideally with joint public
and private sector joint commitment for follow-through on a specific site,
would increase the profile of this agenda and enable more debate and
mutual learning. More generally the GLA should hold and maintain a list of
all relevant projects at all stages and promote learning between teams.

64 PLACES THAT WORK

FIVE PROPOSITIONS FOR CHANGE
IDEA #5 CAPACITY BUILDING
Big Yellow Self Storage, Kingston
source : Big Yellow Self Storage
Big Yellow Group included 12 apartments in
their new warehouse in Kingston following
discussions with planners. This provides the
company with another income and supports
a positive streetscape.
Public perceptions of mixing commercial and residential uses also need to
be addressed. ‘Industrial’ is often associated with dirty and noisy activities
or uses that generate large numbers of commercial vehicle movements.
This is often more prejudice than reality. While the New London Mix is
not suitable for all industrial uses, improving technology and design is
reducing the external impact even of challenging uses such as waste
management.
New means of managing the relationship between neighbouring uses are
already being explored as the city intensifies, such as ‘agent of change’
principles and smart contracts. A better evidence base is needed alongside
exploring how real-time data can be embedded into the planning system.
.
Recommendation
5.2
One or a consortium of industrial and logistics
landlords and operators, together with the
GLA should lead an environmental data pilot to include
real-time monitoring of environmental pollution factors
(noise, dust, air, vibration etc.) across a number of
projects and conditions to provide a better evidence
base on what activities could potentially be mixed.
PLACES THAT WORK 65
 7
Conclusions

Whilst many businesses in London are uniquely rooted in place,

fundamental shifts in technology and in how businesses organise
themselves have shaken up the city’s economic geography and are likely
to do so again. But if London does not have the physical space for existing
businesses to stay, grow or relocate, and for new activities to spring up
and take root, it will not be able to sustain economic success, or optimise
the life chances of its citizens.

Beyond ‘no net loss’

In the realm of office space, planners in the City of London have long
made sure that the Square Mile maintains a level of new office supply so
[43]
it can always provide new activities with appropriately priced space .
We need to adopt a similar approach to productive commercial space
across London, rather than letting such employment space continue to
be eroded. If we want a diverse, distributed enterprise / SME economy,
with startups and growing businesses in digital manufacturing, the
repair economy or food innovation; if we want to maintain the deep
sophistication of local supply chains whether in cultural sector, advertising
or fashion, with its speed of product iteration and acute feeling for
context and trend; and if we want to be able to innovate in last mile
logistics to keep our city moving and sustainable, then we need diverse
employment space. We must move beyond the ‘no-net-loss’ policy
approach of trying to defend and re-provide what we have, towards a ‘net
gain’ attitude where protecting SIL is complemented by adding flexible
places to work across London.

Beyond the current market failure

This report has shown how a New London Mix of light industrial and
residential development could be achieved and what benefits it could
bring in generating vibrant, innovative and inclusive places and supporting
housing delivery. It has also shown that, under current market conditions,
a series of demand and supply factors need to align to convince
investors, developers, operators and occupiers of both the residential

66 PLACES THAT WORK

CONCLUSIONS
and employment floorspace that
this approach is viable and can
create equally good environments
for businesses and residents.
Currently there is caution
within both the residential and
commercial market about this
approach. Whilst our research
has given us confidence that
this is a genuine near-future
opportunity, we are only at the
start of a process of change: we
are near the tipping point, but in
the meantime, many businesses
suffer from the pervading market
failure and affordability crisis they
currently face.
Things can change quickly - 10
years ago, Build to Rent was
a marginal investment class.
Now it is a major component of
investment portfolios, particularly
as other investments like long
secure leases on commercial
property look less certain. The
disruption of the office market
via the rise of WeWork and other
co-working options has similarly
happened in a very short time.
We believe the development
and de-risking of productive
commercial and light industrial
space via intermediaries could
similarly happen quickly and have
massive effect, with investors
telling us that they expect this
to be an important element of
future investment portfolios.
As techniques for evaluating
the social, economic and
environmental benefits of such
workspace evolve, this will unlock
further interest from impact
investors at global scale.
The next steps
What is needed now is a
concentrated approach to
overcoming the remaining hurdles
to enable delivery at scale. We
have identified five big ideas
and eight recommendations to
enable a step change through
new investment arrangements,
intermediary employment space
operators, supportive planning
frameworks, best practice projects
and capacity development
amongst professionals. The
recommendations complement
and depend on each other:
there is no single silver bullet to
achieve the gear shift we need.
The public sector has a big role to
play, but the private and housing
association sectors also need to
take a leadership role to make this
happen.
Our interviews have shown that
many stakeholders in London
are ready to work together on a
range of pilot projects of differing
scale, scope and specification.
As stated in introduction this is
also true outside London - though
many of the market dynamics and
pressure points will be different,
this document holds important
lessons for elsewhere.
Of course, ensuring London’s
enduring prosperity and economic
dynamism this is not just about
physical space - other factors
required to support sustained
prosperity for London and all
Londoners. But space is and will
remain a crucial platform for many
economic activities: a shared
infrastructure for the social and
economic outcomes we want,
whether for training, ideation,
invention, idea validation, test
trading, design, making, fixing
and re-making. If we want Places
that Work, we need to invest in
embedding all these activities
at the heart of London’s new
productive neighbourhoods. In the
[44]
words of Jane Jacobs :
‘The vitality of neighbourhoods
depends on the overlapping and
interweaving of activities’.
PLACES THAT WORK 67
Makerversity workshop, London
Source : Makerversity

68 PLACES THAT WORK

GLOSSARY

‘New London Mix’ is our term to describe the close
co-location of light industrial, distribution and productive
workspace with homes in a way that works for occupiers and
residents.
‘opportunity areas’ are London’s principal opportunities
for accommodating large scale development to provide
substantial numbers of new employment and housing, each
typically more than 5,000 jobs and/or 2,500 homes, with a
mixed and intensive use of land and assisted by good public
transport accessibility.
‘Good Growth’ is growth that is socially and economically
inclusive and environmentally sustainable.
‘Strategic Industrial Locations’ - often known as SIL
- are London’s main reservoirs of industrial, logistics and
related capacity for uses that support the functioning of
London’s economy.
‘Locally Significant Industrial Sites’ (LSIS) are locations
that have particular local importance for industrial and
related functions and designated by boroughs.
‘Industrial intensification’ is the more efficient
industrial use of land through higher plot ratios through
the introductions of mezzanines, basements, multi-story
schemes and introduction of smaller units.
‘no net loss’ of industrial floorspace (and operational yard
space capacity) within designated SIL and LSIS is a policy
proposal in the Draft New London Plan.
‘business rates’ are a tax on business properties set by the
government and collected by local authorities to contribute
towards the cost of local services
‘LEAP’ - The London Economic Action Partnership (LEAP) is
the local enterprise partnership for London. The LEAP brings
entrepreneurs and business together with the Mayoralty and
London Councils to identify strategic actions to support and
lead economic growth and job creation in the capital.
‘permitted development’ allows for certain types of work
to buildings and changes of use without having to apply for
planning permission.
‘Small and Medium-sized Enterprises (SMEs)’ includes
any business with fewer than 250 employees
‘affordable workspace’ is defined in the Draft New
London Plan having rents maintained below the market rate
for that space for a specific social, cultural or economic
development purpose. Normally this is provided for specific
sectors, disadvantaged groups or for start-ups.
‘build to rent’ schemes are larger scale projects specifically
designed for renters with self-contained units and typically
on-site management.

GVA Dan Hill Architecture 00

At GVA, we believe that our spaces
shape us. The places in which we
work, live and play have the power
to make us all healthier, happier and
bring out the best in us. This belief is
at the heart of what we do.
What binds our 1,500 people is our
shared sense of purpose; for real
estate to have an active and positive
impact on people’s lives, wherever in
the property lifecycle we are advising.
From strategy and planning, through to
delivery and management.
Daniel Hill is a leading regeneration
and housing development consultant
able to shape and deliver successful
strategies, neighbourhoods and
buildings that create better places
for councils, housing associations,
developers, social enterprises and
communities. He brings passion and
energy to his work and seeks to make
an immediate impact to the projects
it works on. He is currently working on
Places that Work in Newham, Enfield
and Thamesmead.
Architecture 00 is a practice with a
track record in delivering a broad range
of activities relating to the shaping
of our built environment. Founded
in 2005, our office brings together
skills in action-led research, urban
design strategy, architecture and place
making with a detailed understanding
of how the physical fabric of buildings
can be accompanied by innovative,
engaging and collaborative processes.

Our places build people.

www.gva.co.uk daniel_f_hill@hotmail.com www.architecture00.net

PLACES THAT WORK 69

 References
1 CAG Consultants et al. (2017) London
Industrial Land Demand Final Report; Capital
Enterprise et al. (2018) The Affordability
Crisis: Overview and Recommendations.
London Enterprise Action Partnership.
2 Greater London Authority (2017) Draft New
London Plan, December 2017, p234.
3 Credit where credit is due: The term
New London Mix was allegedly used by
Deputy Mayor Jules Pipe in a speech on the
regeneration of the Old Kent Road, however
we have not been able to confirm when this
was.
4 See e.g. Cities of Making (2018) Cities
Report.
5 e.g. see Urhahn Urban Design (2006)
Industry in the City; We Made That / Aecom
(2015) LLDC Employment Space Study;
Maccreanor Lavington (2016) Old Kent
Road Employment Study - Urban Design
Guidance; New London Architecture (2016)
WRK / LDN: Shaping London’s future
workspaces; Greater London Authority
(2017) Industrial Intensification Primer
6 e.g. see GVA / 00 (forthcoming) Wood
Green Employment and Enterprise Study
7 Maccreanor Lavington et al (2016)
Vacant Ground Floors in New Mixed Use
Development
8 Greater London Authority (forthcoming;
commissioned 2017) Industrial
Intensification: Standards, Guidance,
Viability, and Delivery
9 Regeneris / Future of London (2017)
Making the Case for Place
10 CAG Consultants et al. (2017) London
Industrial Land Demand Final Report
11 Greater London Authority (2014) Artists’
Workspace Study data confirmed by Kirsten
Dunne, 26 January 2018
12 Ramidus Consulting / CAG Consulting
(2017) London Office Policy Review 2017
70 PLACES THAT WORK
13 Greater London Authority (2017) Draft
New London Plan December 2017, p. 225-
234
14 Jessica Ferm / Edward Jones (2015)
London’s industrial land: Cause for concern?
Working paper; Cities of Making (2018) Cities
Report
15 e.g. see Greater London Authority (2016)
Industry in the Upper Lea Valley; and see
CoStar, 14 March 2017 “The Savills/CoStar
logistics debate - Beds and Sheds and the
need for industrial led mixed use” : A debate
hosted by CoStar and Savills in 2017 showed
widespread recognition that the London
context has fundamentally changed and
new forms of industrial and employment
intensification and mix are more relevant
and plausible to developers and operators
than ever.
16 Figure derived from Aecom (2016) London
Industrial Land Supply & Economy Study
2015 p.12
17 Evidence derived from empirical work
undertaken by authors for Wood Green
Employment and Enterprise
Space Study, 2017-2018
18 Kat Hanna (2016) Spaces To Think:
Innovation Districts and the Changing
Geography of London’s Knowledge
Economy, Centre for London
19 Urhahn Urban Design (2006) Industry in
the City
20 Urhahn Urban Design (2006) Industry
in the City; We Made That / Aecom (2015)
LLDC Employment Space Study; Maccreanor
Lavington (2016) Old Kent Road Employment
Study - Urban Design Guidance; Greater
London Authority (2017) Industrial
Intensification Primer
21 For example, through projects co-
funded by the High Street Fund, London
Regeneration Fund and Good
Growth Fund
22 CAG Consultants et al. (2017) London
Industrial Land Demand Final Report; Cities
of Making (2018) Cities Report
23 GVA / 00 (forthcoming) Wood Green
Employment and Enterprise Study
24 e.g. see Greater London Authority (2016)
Industry in the Upper Lea Valley, p8 / p39
“‘Manufacturing” as a designation generates
better quality jobs (on average almost
£66,000 GVA per job, compared to £57,000
GVA per job in transport and logistics) and
provides almost 10,000 jobs in the ULV”;
over 50% of jobs are es-timated to be local.
Equally, our own assessment, using the
Annual Survey of Hours and Earnings for
London suggests an average wage (gross
annual salary) for the sectors most likely
to occupy the New London Mix, would be
marginally higher than the London average
(£43,395 vs £43,062) – which of course does
not take full account of diversity within
sectors but gives a useful indication.
25 Alice Masters / We Made That (2018)
London Made. Available on https://vimeo.
com/252790735 (ac-cessed 03 July 2018)
26 Presentation given by DPD at Old Kent
Road Business engagement event, 12 March
2018
27 e.g. see Cities of Making (2018) Cities
Report; Carlota Perez et al (2017) “Are
We on the Verge of a New Golden Age?”
Strategy+Business online https://www.
strategy-business.com/article/Are-We-on-
the-Verge-of-a-New-Golden-Age (accessed
03 July 2018)
28 Ramidus Consulting / CAG Consulting
(2017) London Office Policy Review 2017;
CAG Consultants et al. (2017) London
Industrial Land Demand Final Report
29 GVA / 00 (forthcoming) Wood Green
Employment and Enterprise Study
30 Ramidus Consulting / CAG Consulting
(2017) London Office Policy Review 2017;
Greater London Authority (2018) Strategic
evidence to support London borough
Article 4 Directions in London’s nationally
significant office locations; London Councils
website https://www.londoncouncils.gov.
uk/our-key-themes/housing-and-planning/
permitted-development-rights-offices/
impact-london (Accessed 03 July 2018).
REFERENCES
In April 2017 government extended General
Permitted Development Rights to allow
conversion of some industrial premise to
residential without the need for planning
permission. The impact of this has yet to be
fully understood, however the most recent
MHCLG data suggests that in Quarter 4 of
2017, 11 Prior Approval Notifications were
submitted across London, of which 4 were
refused. This compares to 183 Prior Approval
Notifications for office space conversions, of
which 59 were refused in the same period,
31 Kat Hanna (2016) Spaces To Think:
Innovation Districts and the Changing
Geography of London’s Knowledge Economy.
Centre for London; Julie Wagner / Nathan
Storring (2016) “So you think you have an
innovation district?” Brookings Institution
online - https://www.brookings.edu/blog/
metropolitan- revolution/2016/03/30/ so-
you-think-you-have-an-innovation-district/
(accessed 03 July 2018)
32 Radio 4 The Bottom Line, comments by
Savills on recent changes in the London co-
working market (09 June 2018)
33 e.g. See G15 website http://g15london.org.
uk/londons-largest-housing-associations-
plan-93000-new-homes/ (accessed 03
July 2018); and British Property Federation
website “Build-to-rent sector grows
pipeline of homes for UK renters by 30%”
https://www.bpf.org.uk/media-listing/
press-releases/build-rent-sector-grows-
pipelinehomes-uk-renters-30 (Accessed 03
July 2018)
34 A detailed technical annex will be
available on the partners’ website
35 Comparison derived from Greater London
Authority (2016) Industry in the Upper Lea
Valley
36 e.g. see Urhahn Urban Design (2006)
Industry in the City; We Made That / Aecom
(2015) LLDC Employment Space Study;
Maccreanor Lavington (2016) Old Kent
Road Employment Study - Urban Design
Guidance; New London Architecture (2016)
WRK / LDN: Shaping London’s future
workspaces; Greater London Authority
(2017) Industrial Intensification Primer
37 The benchmark land value is the value
of a site in its existing use (say, use as an
office building). This aims to recognise the
reality that if a site has a valuable price in
its existing use, no one is going to sell it for
a lower price than that. In fact, in order to
bother selling the site at all, the owner will
want to get a bit of a margin over and above
that existing use value (often referred to
as “existing use plus”) this is likely to be a
range between 10-30% of BLV (the margins
quoted in GLA viability guidance)
38 British Property Federation website
“Build-to-rent sector grows pipeline of
homes for UK renters by 30%” https://www.
bpf.org.uk/media-listing/press-releases/
build-rent-sector-grows-pipeline-homesuk-
renters-30 (Accessed 03 July 2018)
39 Centre for London (2018) The London
Intelligence - Issue 4 Online https://www.
centreforlondon.org/reader/the-london-
intelligence-issue-4/local-authority-
spending/#overall-expenditure (Accessed 03
July 2018)
40 The predictability of business rates
income could be particularly important
as it provides a more regular and reliable
flow of money into the fund, helping with
business planning and predictability for
funding windows. The provision of a more
predictable investment pool and timetable
will also help develop a stronger pipeline of
projects, with those seeking to access
the funds able to plan a project knowing
the fund will be accessible, rather than
reacting to a new funding opportunity in a
short timeframe once it is announced. This
should help both the quality of the projects
supported and also the success rate in
terms of their ability to pay back any loans.
41 Capital Enterprise et al. (2018)
The Affordability Crisis: Overview and
Recommendations. London Enterprise
Action Partnership; Capital Enterprise et
al. (2018) The Affordability Crisis: London
Needs an Accreditation Scheme for Open
Workspaces
PLACES THAT WORK 71
Acknowledgements

We would also like to thank those who shared their

knowledge throughout the research:

Aktar Choudhury, Operational Director Planning & Regeneration, LB Brent

Alison Partridge, Capital Enterprise Projects and Partnerships Lead
Amanda Reid, Head of Planning at LB Newham
Bethan James, Senior Development Manager, GLA
Blossom Young, Head of Operations, Poplar HARCA
Conor Moloney, Consultant and PhD candidate
Craig Sheach, Director, PRP architects
David Saxby, Architecture 00
Derryl Chen, Hawkins Brown
Gareth Crawford, Head of New Ventures, Home Group
Gerard Burgess, Strategic Planner, GLA
Holly Lewis, WeMadeThat
Ian Fletcher, Director of Policy, British Property Federation
Indy Johar, Dark Matter Labs
James Craddock, Regional Director, Greater London, SEGRO
Jennifer Ross, Director at Tibbalds Planning and Urban Design
Jerry Freeman, Senior Director, Development Consultancy, GVA
Jodie Norman, Commercial Property Manager, Notting Hill Genesis
John Allan, Director, Industrial Agency, GVA
John Montague, Managing Director, Big Issues Invest
John Spindler, CEO, Capital Enterprise
John Tatham, Senior Director, Investment Partnerships, GVA
Jonathan Kay, Regeneration, LB Brent
Kevin Logan, Maccreanor Lavington
Kirsten Dunne, Senior Cultural Strategy Officer, GLA
Lev Kerimol, Senior Regeneration Officer, GLA
Maire Grogan, Regeneration, LB Brent
Marcel Baettig, Bow Arts Trust
Mark Brearley, Owner, Kaymet & co-ordinator Vital OKR
Matt Dibben, Head of Employment & Skills, LB Brent
Matt Hayes, Senior Consultant, Development Consultancy, GVA
Neil Impiazzi, Partnerships Development Director, SEGRO
Nick Hartwright, Projekt and MillCo
Nick Roberts, Director, Investment, GVA
Nick Wigner, Head of Commercial, Peabody
Patrick Duffy, Head of Delivery, Peabody
Paul Augarde, Director of Placemaking, Poplar HARCA
Paul Lewin, Planning Policy & Projects, LB Brent
Paul Tebbit, Managing Director, BlackRock
Richard Upton, Deputy Chief Executive, U+I
Rob Harris, Ramidus Consulting
Rob Krzyszowksi, Head of Planning, LB Brent
Robert Baldwin, Senior Director, Valuation, GVA
Simon Pitkeathley, Chief Executive, Camden Town Unlimited
Sven Meundner, Owner Beispeil Ltd
Toby Hyam, Creative Space Management
Will Close-Brooks, Head of Structured Products, Investing for Good

PLACES THAT WORK 72

 ELECTRONICS
REPAIR
WORKSHOP VIDEO
PRODUCTION
CNC
MACHINIST

Places that Work CAR

REPAIR
London needs to accommodate a growing
population, but also provide space for its diverse
economy to flourish. But the capital’s portfolio
of flexible employment and industrial spaces is
being eroded by rapid redevelopment, at a time SHOP & EVENTS FASHION
when demand for such space is growing. DISPLAY SAMPLING
MANUFACTURER PRODUCTION

Places that Work sets out the scale of the

challenge and calls for a new approach to
delivering schemes that co-locate light industrial
and other productive commercial space with
homes. This ‘New London Mix’ has the potential FURNITURE
RESTORATION
to provide many millions of square metres
of new employment space in London’s key
areas of change, together with new housing.
SMALL OFFICE,
Despite
LEATHERbeing already viable in many parts of WORKSHOP AND
MAKER there are some persistent institutional
London, STUDIO UNITS
OVER ADVANCED
barriers that prevent the New London Mix from MANUFACTURING
CENTRE
progressing at scale. Places that Work describes
the policy changes and financial and institutional
shifts required to deliver the next generation of
mixed use development in London and build a
more inclusive, resilient and successful city.
METAL TRAY
FABRICATOR
This project has been generously supported by
Home Group, Royal Docks Team and LEAP.

Y
R
FINAL MILE &
LOGISTICS PRINT, T
DISTRIBUTION
& DIGITAL COFFEE
MARKETING ROASTING
PRODUCTION FACTORY
SERVICES

ART
STORE

SET
STORAGE KI
FA
IN

DRIED
FRUIT
IMPORTER

FINAL MILE
LOGISTICS

BUILDING
SUPPLIES
PITTA BREAD
MANUFACTURER

TETHERED
LIVE WORK

WHOLESALE
FLORIST

DAN
HILL 00 STAGE
& PROP
DESIGN
PLACES THAT WORK 74
STUDIO